SunTrust 2015 Annual Report Download - page 115

Notes to Consolidated Financial Statements, continued
87
Accounting Standards Not Yet Adopted
The following table provides a brief description of accounting standards that have been issued, but are not yet adopted, that could
have a material effect on the Company's financial statements:
Standard Description Date of Adoption
Effect on the Financial Statements or Other
Significant Matters
ASU 2014-09,
Revenue from
Contracts with
Customers
The ASU supersedes the revenue recognition requirements
in ASC Topic 605, Revenue Recognition, and most industry-
specific guidance throughout the Industry Topics of the
Codification. The core principle of the ASU is that an entity
should recognize revenue to depict the transfer of promised
goods or services to customers in an amount that reflects the
consideration to which the entity expects to be entitled in
exchange for those goods or services. The ASU may be
adopted either retrospectively or on a modified retrospective
basis to new contracts and existing contracts with remaining
performance obligations as of the effective date.
January 1, 2018
(early adoption
permitted beginning
January 1, 2017)
The Company is continuing to evaluate the
alternative methods of adoption and the anticipated
effects on the financial statements and related
disclosures.
ASU 2016-01,
Recognition and
Measurement of
Financial Assets
and Liabilities
The ASU addresses certain aspects of recognition,
measurement, presentation, and disclosure of financial
instruments. The main provisions require investments in
equity securities to be measured at fair value through net
income, unless they qualify for a practicability exception,
and require fair value changes arising from changes in
instrument-specific credit risk for financial liabilities that
are measured under the fair value option to be recognized
in other comprehensive income. With the exception of
disclosure requirements that would be adopted
prospectively, the ASU must be adopted on a modified
retrospective basis.
January 1, 2018
(early adoption
permitted beginning
January 1, 2016 or
2017 for the provision
related to changes in
instrument-specific
credit risk for
financial liabilities
under the fair value
option)
The Company is early adopting the provision
related to changes in instrument-specific credit risk
beginning January 1, 2016, which will result in an
immaterial reclassification from retained earnings
to OCI. The prospective impact of this provision
on the financial statements is a function of the
principal amount of financial liabilities under the
fair value option and changes in the Company's
credit spreads. The Company is evaluating the
impact of the remaining provisions of this ASU on
the financial statements and related disclosures;
however, the impact is not expected to be material.
NOTE 2 - ACQUISITIONS/DISPOSITIONS
During the years ended December 31, 2015, 2014, and 2013, the Company had the following notable disposition:
(Dollars in millions) Date Cash Received/
(Paid) Goodwill Other Intangibles Pre-tax Gain
2014
Sale of RidgeWorth 5/30/2014 $193 ($40) ($9) $105
In 2014, the Company completed the sale of RidgeWorth, its
asset management subsidiary with approximately $49.1 billion
in assets under management. The Company received cash
proceeds of $193 million, removed $96 million in net assets and
$23 million in noncontrolling interests, and recognized a pre-tax
gain of $105 million in connection with the sale, net of
transaction-related expenses.
The Company’s results for the year ended December 31,
2014, included income before provision for income taxes related
to RidgeWorth, excluding the gain on sale, of $22 million,
comprised of $81 million of revenue and $59 million of expense.
For the year ended December 31, 2013, the Company’s income
before provision for income taxes included $64 million related
to RidgeWorth, comprised of $194 million of revenue and $130
million of expense.
The financial results of RidgeWorth, including the gain on
sale, are reflected in the Corporate Other segment for the years
ended December 31, 2014 and 2013. There were no other
material acquisitions or dispositions during the three years ended
December 31, 2015.
NOTE 3 - FEDERAL FUNDS SOLD AND SECURITIES FINANCING ACTIVITIES
Federal Funds Sold and Securities Borrowed or Purchased Under Agreements to Resell
Fed funds sold and securities borrowed or purchased under
agreements to resell were as follows:
(Dollars in millions) December 31,
2015
December 31,
2014
Fed funds sold $38 $38
Securities borrowed 277 290
Securities purchased under agreements to
resell 962 832
Total Fed funds sold and securities
borrowed or purchased under
agreements to resell $1,277 $1,160
Securities purchased under agreements to resell are primarily
collateralized by U.S. government or agency securities and are
carried at the amounts at which the securities will be
subsequently resold. Securities borrowed are primarily
collateralized by corporate securities. The Company borrows
securities and purchases securities under agreements to resell as
part of its securities financing activities. On the acquisition date
of these securities, the Company and the related counterparty
agree on the amount of collateral required to secure the principal