AIG 2012 Annual Report Download - page 227

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1. BASIS OF PRESENTATION
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American International Group, Inc. is a leading international insurance organization serving customers in more than
130 countries. AIG companies serve commercial, institutional and individual customers through one of the most
extensive worldwide property-casualty networks of any insurer. In addition, AIG companies are leading providers of
life insurance and retirement services in the United States. AIG Common Stock, par value $2.50 per share (AIG
Common Stock), is listed on the New York Stock Exchange and the Tokyo Stock Exchange. Unless the context
indicates otherwise, the terms ‘‘AIG,’’ ‘‘we,’’ ‘‘us’’ or ‘‘our’’ mean American International Group, Inc. and its
consolidated subsidiaries and the term ‘‘AIG Parent’’ means American International Group, Inc. and not to any of its
consolidated subsidiaries.
The consolidated financial statements include the accounts of AIG, our controlled subsidiaries (generally through a
greater than 50 percent ownership of voting rights of a voting interest entity), and variable interest entities (VIEs) in
which we are the primary beneficiary. Equity investments in corporate entities that we do not consolidate, but in
which we hold 20 percent to 50 percent of the voting rights and investments in partnership and partnership-like
entities for which we have more than minor influence over operating and financial policies, are accounted for under
the equity method unless we have elected the fair value option.
Certain of our foreign subsidiaries included in the consolidated financial statements report on different annual fiscal
period bases, in most cases ending November 30. The effect on our consolidated financial condition and results of
operations of all material events occurring at these subsidiaries between such fiscal year end and December 31 for
all periods presented has been recorded.
The accompanying consolidated financial statements have been prepared in accordance with accounting principles
generally accepted in the United States (GAAP). All material intercompany accounts and transactions have been
eliminated.
Use of Estimates
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The preparation of financial statements in accordance with GAAP requires the application of accounting policies that
often involve a significant degree of judgment. We consider the accounting policies that are most dependent on the
application of estimates and assumptions to be those relating to items considered by management in the
determination of:
• classification of International Lease Finance Corporation (ILFC) as held for sale;
• insurance liabilities, including property and casualty and mortgage guaranty unpaid claims and claims adjustment
expenses and future policy benefits for life and accident and health contracts;
• income tax assets and liabilities, including recoverability of our net deferred tax asset and the predictability of
future tax operating profitability of the character necessary to realize the net deferred tax asset;
• recoverability of assets including reinsurance assets;
• estimated gross profits for investment-oriented products;
• impairment charges, including other-than-temporary impairments of financial instruments and goodwill impairments;
• liabilities for legal contingencies; and
• fair value measurements of certain financial assets and liabilities.
These accounting estimates require the use of assumptions about matters, some of which are highly uncertain at the
time of estimation. To the extent actual experience differs from the assumptions used, our consolidated financial
condition, results of operations and cash flows could be materially affected.
Prior Period Reclassifications and Segment Changes
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Prior period amounts were reclassified to conform to the current period presentation. Significant items include:
• Segment changes discussed in Note 3 herein.
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AIG 2012 Form 10-K210
ITEM 8 / NOTE 1. BASIS OF PRESENTATION