Ameriprise 2012 Annual Report Download - page 61

We consolidate certain collateralized debt obligations (‘‘CDOs’’) and other investment products (collectively, ‘‘investment
entities’’) for which we provide asset management services to and sponsor for the investment of client assets in the
normal course of business. These entities are defined as consolidated investment entities (‘‘CIEs’’). For further information
on CIEs, see Note 4 to our Consolidated Financial Statements. Changes in the valuation of the CIE assets and liabilities
impact pretax income. The net income (loss) of the CIEs is reflected in net income (loss) attributable to noncontrolling
interests. The results of operations of the CIEs are reflected in the Corporate & Other segment. On a consolidated basis,
the management fees we earn for the services we provide to the CIEs and the related general and administrative expenses
are eliminated and the changes in the assets and liabilities related to the CIEs, primarily debt and underlying syndicated
loans, are reflected in net investment income. We continue to include the fees in the management and financial advice
fees line within our Asset Management segment.
While our consolidated financial statements are prepared in accordance with U.S. generally accepted accounting principles
(‘‘GAAP’’), management believes that operating measures, which exclude net realized gains or losses; the market impact
on variable annuity guaranteed living benefits, net of hedges and the related DSIC and DAC amortization; integration and
restructuring charges; income (loss) from discontinued operations; and the impact of consolidating CIEs, best reflect the
underlying performance of our core operations and facilitate a more meaningful trend analysis. While the consolidation of
the CIEs impacts our balance sheet and income statement, our exposure to these entities is unchanged and there is no
impact to the underlying business results. Management uses certain of these non-GAAP measures to evaluate our financial
performance on a basis comparable to that used by some securities analysts and investors. Also, certain of these
non-GAAP measures are taken into consideration, to varying degrees, for purposes of business planning and analysis and
for certain compensation-related matters. Throughout our Management’s Discussion and Analysis, these non-GAAP
measures are referred to as operating measures.
It is management’s priority to increase shareholder value over a multi-year horizon by achieving our on-average, over-time
financial targets.
Our financial targets are:
• Operating total net revenue growth of 6% to 8%,
• Operating earnings per diluted share growth of 12% to 15%, and
• Operating return on equity excluding accumulated other comprehensive income of 15% to 18%.
The following tables reconcile our GAAP measures to operating measures:
Years Ended
December 31,
2012 2011
(in millions)
Total net revenues $ 10,217 $ 10,192
Less: Revenue attributable to the CIEs 71 136
Less: Net realized gains 76
Less: Integration/restructuring charges (4) —
Operating total net revenues $ 10,143 $ 10,050
44