Visa 2011 Annual Report Download - page 79

Table of Contents
VISA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
September 30, 2011
(in millions, except as noted)
Note 1—Summary of Significant Accounting Policies
Organization. In a series of transactions from October 1 to October 3, 2007, Visa Inc. ("Visa" or the "Company") undertook a reorganization in which
Visa U.S.A. Inc. ("Visa U.S.A."), Visa International Service Association ("Visa International"), Visa Canada Corporation ("Visa Canada") and Inovant LLC
("Inovant") became direct or indirect subsidiaries of Visa and the retrospective responsibility plan was established. See Note 3—Retrospective Responsibility
Plan. The reorganization was reflected as a single transaction on October 1, 2007 using the purchase method of accounting with Visa U.S.A. as the accounting
acquirer. Visa Europe did not become a subsidiary of Visa Inc., but rather remained owned and governed by its European member financial institutions. See
Note 2—Visa Europe.
Visa Inc. is a global payments technology company that connects consumers, businesses, banks and governments around the world, enabling them to
use digital currency instead of cash and checks. Visa and its wholly-owned consolidated subsidiaries, including Visa U.S.A. Inc., Visa International Service
Association, Visa Worldwide Pte. Limited ("VWPL"), Visa Canada Corporation, Inovant LLC and CyberSource Corporation ("CyberSource"), operate the
world's largest retail electronic payments network. The Company provides its clients with payment processing platforms that encompass consumer credit,
debit, prepaid and commercial payments, and facilitates global commerce through the transfer of value and information among financial institutions,
merchants, consumers, businesses and government entities. The Company does not issue cards, set fees, or determine the interest rates consumers will be
charged on Visa-branded cards, which are the independent responsibility of the Company's issuing clients. The Company acquired PlaySpan Inc.
("PlaySpan") on March 1, 2011, and Fundamo (Proprietary) Limited ("Fundamo") on June 9, 2011. See Note 5—Acquisitions.
Consolidation and basis of presentation. The consolidated financial statements include the accounts of Visa Inc. and its consolidated entities and are
presented in accordance with accounting principles generally accepted in the United States of America ("U.S. GAAP"). The Company consolidates its
majority-owned and controlled entities, including variable interest entities ("VIEs") for which the Company is the primary beneficiary. The Company's VIEs
have not been material to its consolidated financial statements as of and for the periods presented. Non-controlling interests are reported as a component of
equity. All significant intercompany accounts and transactions are eliminated in consolidation. Beginning with the first quarter of fiscal 2011, equity in
earnings of unconsolidated affiliates is combined with other in the other income (expense) line on the consolidated statements of operations. Prior period
information has been reclassified to conform to this presentation. The Company also updated select captions within the consolidated financial statements
beginning with the first quarter of fiscal 2011 to better reflect underlying activities; however, the grouping of underlying financial accounts remains
unchanged.
The Company has one reportable segment, "Payment Services." The Company's activities are interrelated and each activity is dependent upon and
supportive of the other. Accordingly, all significant operating decisions are based on analysis of Visa Inc. as a single global business.
Effective fiscal 2011, the Company adopted Accounting Standards Codification ("ASC") 810-10, issued by the Financial Accounting Standards Board
("FASB") that changed how a company determines when an entity that is insufficiently capitalized or is not controlled through voting (or similar rights)
should be consolidated. The determination of whether a company is required to consolidate an entity is based
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