Xerox 2013 Annual Report Download - page 84

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XEROX CORPORATION
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(in millions, except per-share data and where otherwise noted)
Note 1 – Summary of Significant Accounting Policies
References herein to “we,” “us,” “our,” the “Company” and “Xerox” refer to Xerox Corporation and its consolidated
subsidiaries unless the context suggests otherwise.
Description of Business and Basis of Presentation
Xerox is a $21.4 billion global enterprise for business process and document management solutions. We offer
business process outsourcing and IT outsourcing services, including data processing, healthcare solutions, human
resource benefits management, finance support, transportation solutions and customer relationship management
services for commercial and government organizations worldwide. We also provide extensive leading-edge
document technology, services, software and genuine Xerox supplies for graphic communication and office printing
environments of any size.
Basis of Consolidation
The Consolidated Financial Statements include the accounts of Xerox Corporation and all of our controlled
subsidiary companies. All significant intercompany accounts and transactions have been eliminated. Investments in
business entities in which we do not have control, but we have the ability to exercise significant influence over
operating and financial policies (generally 20% to 50% ownership) are accounted for using the equity method of
accounting. Operating results of acquired businesses are included in the Consolidated Statements of Income from
the date of acquisition.
We consolidate variable interest entities if we are deemed to be the primary beneficiary of the entity. Operating
results for variable interest entities in which we are determined to be the primary beneficiary are included in the
Consolidated Statements of Income from the date such determination is made.
For convenience and ease of reference, we refer to the financial statement caption “Income before Income Taxes
and Equity Income” as “pre-tax income” throughout the Notes to the Consolidated Financial Statements.
In 2013 we completed the sale of our U.S. and Canadian (North American or N.A.) and Western European
(European) Paper businesses. Results from these paper-related businesses are reported as discontinued
operations and all prior period results have been reclassified to reflect this change. Refer to Note 3 - Acquisitions
and Divestitures for additional information regarding discontinued operations.
Use of Estimates
The preparation of our Consolidated Financial Statements requires that we make estimates and assumptions that
affect the reported amounts of assets and liabilities, as well as 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. Future events and their effects cannot be predicted with certainty; accordingly, our accounting estimates
require the exercise of judgment. The accounting estimates used in the preparation of our Consolidated Financial
Statements will change as new events occur, as more experience is acquired, as additional information is obtained
and as our operating environment changes. Our estimates are based on management's best knowledge of current
events, historical experience, actions that the company may undertake in the future and on various other
assumptions that are believed to be reasonable under the circumstances. As a result, actual results may be different
from these estimates.
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