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F-9
Avis Budget Group, Inc.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
(Unless otherwise noted, all dollar amounts are in millions, except per share amounts)
1. Basis of Presentation
Avis Budget Group, Inc. provides car and truck rentals and ancillary services to businesses and consumers worldwide.
The accompanying Consolidated Financial Statements include the accounts and transactions of Avis Budget Group, Inc.
and its subsidiaries (“Avis Budget”), as well as entities in which Avis Budget directly or indirectly has a controlling
financial interest (collectively, the “Company”).
The Company operates the following reportable business segments:
North America—provides car rentals in the United States and vehicle rentals in Canada, as well as related
products and services.
International—provides, and licenses the Company’s brands to third parties for, vehicle rentals and ancillary
products and services in Europe, the Middle East, Asia, Africa, South America, Central America, the Caribbean,
Australia and New Zealand.
Truck Rental—provides truck rentals and related services to consumers and commercial users in the United
States.
In October 2012 and 2011, the Company acquired Apex Car Rentals (“Apex”) of New Zealand and Avis Europe plc
(“Avis Europe”), respectively. The Company’s International segment includes the operational and financial results of
Avis Europe and Apex since the respective acquisitions.
Vehicle Programs. The Company presents separately the financial data of its vehicle programs. These programs are
distinct from the Company’s other activities since the assets under vehicle programs are generally funded through the
issuance of debt that is collateralized by such assets. The income generated by these assets is used, in part, to repay the
principal and interest associated with the debt. Cash inflows and outflows relating to the acquisition of such assets and
the principal debt repayment or financing of such assets are classified as activities of the Company's vehicle programs.
The Company believes it is appropriate to segregate the financial data of its vehicle programs because, ultimately, the
source of repayment of such debt is the realization of such assets.
2. Summary of Significant Accounting Policies
Accounting Principles
The Company’s Consolidated Financial Statements have been prepared in accordance with accounting principles
generally accepted in the United States of America (“GAAP”).
Principles of Consolidation
The Consolidated Financial Statements include the accounts of Avis Budget and all entities in which the Company has a
direct or indirect controlling financial interest and variable interest entities (“VIEs”) for which the Company has
determined it is the primary beneficiary. Intercompany transactions have been eliminated in consolidation.
Use of Estimates and Assumptions
The use of estimates and assumptions as determined by management is required in the preparation of the Consolidated
Financial Statements in conformity with GAAP. These estimates are based on management’s evaluation of historical
trends and other information available when the Consolidated Financial Statements are prepared and may affect the
amounts reported and related disclosures. Changes in estimates are recognized prospectively. Actual results could differ
from those estimates.
Revenue Recognition
The Company derives revenue primarily through the operation and licensing of the Avis and Budget rental systems and
by providing vehicle rentals and other services to business and leisure travelers and others. Other revenue includes