The Hartford 2015 Annual Report Download - page 139

Table of Contents THE HARTFORD FINANCIAL SERVICES GROUP, INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Dollar amounts in millions, except for per share data, unless otherwise stated)
1. Basis of Presentation and Significant Accounting Policies
F-8
Basis of Presentation
The Hartford Financial Services Group, Inc. is a holding company for insurance and financial services subsidiaries that provide property
and casualty insurance, group life and disability products and mutual funds to individual and business customers in the United States
(collectively, “The Hartford”, the “Company”, “we” or “our”). Also, the Company continues to runoff life and annuity products
previously sold.
On June 30, 2014, the Company completed the sale of all of the issued and outstanding equity of Hartford Life Insurance KK, a Japanese
company ("HLIKK"), to ORIX Life Insurance Corporation, a subsidiary of ORIX Corporation, a Japanese company. The operations of
the Company's HLIKK business are reported as discontinued operations. For further information regarding the sale of HLIKK and
discontinued operations, see the following Discontinued Operations section and Note 18 - Discontinued Operations and Business
Dispositions of Notes to Consolidated Financial Statements.
On December 12, 2013, the Company completed the sale of the issued and outstanding equity of Hartford Life International Limited, a
U.K. company ("HLIL"), to Columbia Insurance Company, a Berkshire Hathaway company.
On January 1, 2013, the Company completed the sale of its Retirement Plans business to Massachusetts Mutual Life Insurance Company
("MassMutual") and on January 2, 2013 the Company completed the sale of its Individual Life insurance business to The Prudential
Insurance Company of America ("Prudential"), a subsidiary of Prudential Financial, Inc. These sales were structured as reinsurance
transactions.
For further discussion of these transactions, see Note18 - Discontinued Operations and Business Dispositions of Notes to Consolidated
Financial Statements.
The Consolidated Financial Statements have been prepared in accordance with accounting principles generally accepted in the United States
of America (“U.S. GAAP”) which differ materially from the accounting practices prescribed by various insurance regulatory authorities.
Consolidation
The Consolidated Financial Statements include the accounts of The Hartford Financial Services Group, Inc., companies in which the
Company directly or indirectly has a controlling financial interest and those variable interest entities (“VIEs”) which the Company is
required to consolidate. Entities in which the Company has significant influence over the operating and financing decisions but is not
required to consolidate are reported using the equity method. For further information on VIEs see Note 6 - Investments and Derivative
Instruments of the Notes to Consolidated Financial Statements. All intercompany transactions and balances between The Hartford and its
subsidiaries and affiliates have been eliminated.
Discontinued Operations
The results of operations of a component of the Company are reported in discontinued operations when certain criteria are met as of the
date of disposal, or earlier if classified as held-for-sale. When a component is identified for discontinued operations reporting, amounts
for prior periods are retrospectively reclassified as discontinued operations. Prior to January 1, 2015, components were identified as
discontinued operations if the operations and cash flows of the component had been or would be eliminated from the ongoing operations
of the Company as a result of the disposal transaction and the Company would not have any significant continuing involvement in the
operations of the component after the disposal transaction. For transactions occurring January 1, 2015 or later, under updated guidance
issued by the Financial Accounting Standards Board ("FASB"), components are identified as discontinued operations if they are a major
part of an entity's operations and financial results such as a separate major line of business or a separate major geographical area of
operations regardless of whether the Company has significant continuing involvement in the operations of the component after the
disposal transaction. For information on the specific discontinued operations, see Note 18 - Discontinued Operations and Business
Dispositions of the Notes to Consolidated Financial Statements.
Use of Estimates
The preparation of financial statements, in conformity with U.S. GAAP, requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial
statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those
estimates.