Chevron 2012 Annual Report Download - page 11

Financial Table of Contents
Management’s Discussion and Analysis of
Financial Condition and Results of Operations
Key Financial Results 10
Earnings by Major Operating Area 10
Business Environment and Outlook 10
Operating Developments 13
Results of Operations 14
Consolidated Statement of Income 17
Selected Operating Data 18
Liquidity and Capital Resources 19
Financial Ratios 21
Guarantees, Off-Balance-Sheet Arrangements and Contractual
Obligations, and Other Contingencies 21
Financial and Derivative Instruments 22
Transactions With Related Parties 23
Litigation and Other Contingencies 23
Environmental Matters 23
Critical Accounting Estimates and Assumptions 24
New Accounting Standards 27
Quarterly Results and Stock Market Data 28
Notes to the Consolidated Financial Statements
Note 1 Summary of Significant Accounting Policies 36
Note 2 Noncontrolling Interests 38
Note 3 Information Relating to the Consolidated
Statement of Cash Flows 39
Note 4 Summarized Financial Data – Chevron U.S.A. Inc. 40
Note 5 Summarized Financial Data –
Chevron Transport Corporation Ltd. 40
Note 6 Summarized Financial Data – Tengizchevroil LLP 41
Note 7 Lease Commitments 41
Note 8 Fair Value Measurements 41
Note 9 Financial and Derivative Instruments 43
Note 10 Operating Segments and Geographic Data 44
Note 11 Investments and Advances 46
Note 12 Properties, Plant and Equipment 48
Note 13 Litigation 48
Note 14 Taxes 51
Note 15 Short-Term Debt 54
Note 16 Long-Term Debt 54
Note 17 New Accounting Standards 55
Note 18 Accounting for Suspended Exploratory Wells 55
Note 19 Stock Options and Other Share-Based Compensation 56
Note 20 Employee Benefit Plans 57
Note 21 Equity 63
Note 22 Other Contingencies and Commitments 63
Note 23 Asset Retirement Obligations 66
Note 24 Other Financial Information 66
Note 25 Earnings Per Share 67
Note 26 Acquisition of Atlas Energy, Inc. 68
Five-Year Financial Summary 69
Five-Year Operating Summary 70
Supplemental Information on Oil and Gas Producing Activities 71
Consolidated Financial Statements
Report of Management 29
Report of Independent Registered Public Accounting Firm 30
Consolidated Statement of Income 31
Consolidated Statement of Comprehensive Income 32
Consolidated Balance Sheet 33
Consolidated Statement of Cash Flows 34
Consolidated Statement of Equity 35
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Chevron Corporation 2012 Annual Report 9
This Annual Report of Chevron Corporation contains forward-looking state-
ments relating to Chevron’s operations that are based on management’s
current expectations, estimates and projections about the petroleum,
chemicals and other energy-related industries. Words such as “anticipates,”
“expects,” “intends,” “plans,” “targets,” “forecasts,” “projects,” “believes,”
“seeks,” “schedules,” “estimates,” “budgets,” “outlook” and similar expressions
are intended to identify such forward-looking statements. These statements are
not guarantees of future performance and are subject to certain risks, uncer-
tainties and other factors, many of which are beyond the company’s control
and are difficult to predict. Therefore, actual outcomes and results may
differ materially from what is expressed or forecasted in such forward-looking
statements. The reader should not place undue reliance on these forward-
looking statements, which speak only as of the date of this report. Unless
legally required, Chevron undertakes no obligation to update publicly any
forward-looking statements, whether as a result of new information, future
events or otherwise.
Among the important factors that could cause actual results to differ
materially from those in the forward-looking statements are: changing crude
oil and natural gas prices; changing refining, marketing and chemical margins;
actions of competitors or regulators; timing of exploration expenses; timing of
crude oil liftings; the competitiveness of alternate-energy sources or product
substitutes; technological developments; the results of operations and financial
condition of equity affiliates; the inability or failure of the company’s joint-
venture partners to fund their share of operations and development activities;
the potential failure to achieve expected net production from existing
and future crude oil and natural gas development projects; potential delays
in the development, construction or start-up of planned projects; the potential
disruption or interruption of the company’s production or manufacturing facil-
ities or delivery/transportation networks due to war, accidents, political events,
civil unrest, severe weather or crude oil production quotas that might be
imposed by the Organization of Petroleum Exporting Countries; the potential
liability for remedial actions or assessments under existing or future environ-
mental regulations and litigation; significant investment or product changes
required by existing or future environmental statutes, regulations and
litigation; the potential liability resulting from other pending or future
litigation; the company’s future acquisition or disposition of assets and gains
and losses from asset dispositions or impairments; government-mandated
sales, divestitures, recapitalizations, industry-specific taxes, changes in fiscal
terms or restrictions on scope of company operations; foreign currency
movements compared with the U.S. dollar; the effects of changed accounting
rules under generally accepted accounting principles promulgated by rule-
setting bodies. In addition, such results could be affected by general domestic
and international economic and political conditions. Other unpredictable or
unknown factors not discussed in this report could also have material adverse
effects on forward-looking statements.
Cautionary Statement Relevant to Forward-Looking Information
for the Purpose of “Safe Harbor” Provisions of the Private Securities
Litigation Reform Act of 1995