Tesla 2012 Annual Report Download - page 87

Table of Contents
which requires us to interpret the applicable tax laws and regulations in effect in such jurisdictions. Such returns are subject to audit by the
various federal, state and foreign taxing authorities, who may disagree with respect to our tax positions. We believe that our accounting
consideration is adequate for all open audit years based on our assessment of many factors, including past experience and interpretations of tax
law. We review and update our estimates in light of changing facts and circumstances, such as the closing of a tax audit, the lapse of a statute of
limitations or a material change in estimate. To the extent that the final tax outcome of these matters differs from our expectations, such
differences may impact income tax expense in the period in which such determination is made. The eventual impact on our income tax expense
depends in part if we still have a valuation allowance recorded against our deferred tax assets in the period that such determination is made.
Recent Accounting Pronouncements
In June 2011, the FASB issued an accounting standard update, which revises the manner in which companies present comprehensive
income in their financial statements. The new guidance removes the presentation options and requires entities to report components of
comprehensive income in either (1) a continuous statement of comprehensive income or (2) two separate but consecutive statements. In
December 2011, the FASB further amended its guidance to defer changes related to the presentation of reclassification adjustments
indefinitely. The guidance (other than the portion regarding the presentation of reclassification adjustments which, as noted above, has been
deferred indefinitely) is effective for fiscal years, and interim periods within those years beginning after December 15, 2011. Early adoption is
permitted. We anticipate adopting the guidance in fiscal 2012. We do not expect the adoption of the guidance to have a material impact on our
consolidated financial statements.
In January 2010, the FASB issued updated guidance related to fair value measurements and disclosures which requires a reporting entity to
disclose separately the amounts of significant transfers in and out of Level I and Level II fair value measurements and to describe the reasons for
the transfers. In addition, in the reconciliation of fair value measurements using Level III inputs, a reporting entity will be required to disclose
information about purchases, sales, issuances and settlements on a gross rather than on a net basis. The updated guidance will also require fair
value disclosures for each class of assets and liabilities and disclosures about the valuation techniques and inputs used to measure fair value for
both recurring and non-recurring Level II and Level III fair value measurements. The adoption of this updated guidance did not have a material
impact on our consolidated financial statements.
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