Prudential 2012 Annual Report Download - page 101

current policies in force, and assume market growth and interest crediting consistent with assumptions used in amortizing deferred acquisition costs and
value of business acquired. These cash outflows are undiscounted with respect to interest and, as a result, the sum of the cash outflows shown for all
years in the table of $1,162 billion exceeds the corresponding liability amounts of $612 billion included in the Consolidated Financial Statements asof
December 31, 2012. Separate account liabilities are legally insulated from general account obligations, and it is generally expected these liabilities will
be fully funded by separate account assets and their related cash flows. We have made significant assumptions to determine the future estimated cash
outflows related to the underlying policies and contracts. Due to the significance of the assumptions used, actual cash outflows will differ, possibly
materially, from these estimates.
(6) The estimated payments due by period for other liabilities includes securities sold under agreements to repurchase, cash collateral for loaned securities,
liabilities for unrecognized tax benefits, bank customer liabilities, and other miscellaneous liabilities. Amounts presented in the table also exclude
$1.577 billion of notes of consolidated VIE’s which recourse for these obligations is limited to the assets of the respective VIE and do not have recourse
to the general credit of the company.
We also enter into agreements to purchase goods and services in the normal course of business; however, these purchase obligations
are not material to our consolidated results of operations or financial position as of December 31, 2012.
Off-Balance Sheet Arrangements
Guarantees and Other Contingencies
In the course of our business, we provide certain guarantees and indemnities to third parties pursuant to which we may be contingently
required to make payments in the future. See “Commitments and Guarantees” within Note 23 to the Consolidated Financial Statements for
additional information.
Other Contingent Commitments
We also have other commitments, some of which are contingent upon events or circumstances not under our control, including those
at the discretion of our counterparties. See “Commitments and Guarantees” within Note 23 to the Consolidated Financial Statements for
additional information regarding these commitments. For further discussion of certain of these commitments that relate to our separate
accounts, also see “—Liquidity associated with other activities—Asset Management operations.”
Other Off-Balance Sheet Arrangements
We do not have retained or contingent interests in assets transferred to unconsolidated entities, or variable interests in unconsolidated
entities or other similar transactions, arrangements or relationships that serve as credit, liquidity or market risk support, that we believe are
reasonably likely to have a material effect on our financial condition, changes in financial condition, revenues or expenses, results of
operations, liquidity, capital expenditures or our access to or requirements for capital resources. In addition, we do not have relationships
with any unconsolidated entities that are contractually limited to narrow activities that facilitate our transfer of or access to associated
assets. See Note 5 to the Consolidated Financial Statements for additional information.
Prudential Financial, Inc. 2012 Annual Report 99