DuPont 2015 Annual Report Download - page 68

E. I. du Pont de Nemours and Company
Notes to the Consolidated Financial Statements
(Dollars in millions, except per share)
F-9
1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The company follows generally accepted accounting principles in the United States of America (GAAP). The significant accounting
policies described below, together with the other notes that follow, are an integral part of the Consolidated Financial Statements.
Preparation of Financial Statements
The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that
affect the reported amounts of assets and liabilities and 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. Actual results could differ from those
estimates.
Basis of Consolidation
The Consolidated Financial Statements include the accounts of the company, subsidiaries in which a controlling interest is
maintained and variable interest entities (VIEs) for which DuPont is the primary beneficiary. For those consolidated subsidiaries
in which the company's ownership is less than 100 percent, the outside stockholders' interests are shown as noncontrolling interests.
Investments in affiliates over which the company has significant influence but not a controlling interest are carried on the equity
method. At December 31, 2015 and 2014, the assets, liabilities and operations of VIEs for which DuPont is the primary beneficiary
were not material to the Consolidated Financial Statements of the company.
The company is also involved with certain joint ventures accounted for under the equity method of accounting that are VIEs. The
company is not the primary beneficiary, as the nature of the company's involvement with the VIEs does not provide it the power
to direct the VIEs significant activities. Future events may require these VIEs to be consolidated if the company becomes the
primary beneficiary. At December 31, 2015 and 2014, the maximum exposure to loss related to the unconsolidated VIEs is not
considered material to the Consolidated Financial Statements of the company.
Basis of Presentation
Certain reclassifications of prior year's data have been made to conform to current year's presentation.
On July 1, 2015, the company completed the separation of its Performance Chemicals segment through the spin-off of all of the
issued and outstanding stock of The Chemours Company (Chemours). In accordance with GAAP, the financial position and results
of operations of the Performance Chemicals segment are presented as discontinued operations and, as such, have been excluded
from continuing operations and segment results for all periods presented. The sum of the individual earnings per share amounts
from continuing operations and discontinued operations may not equal the total company earnings per share amounts due to
rounding. The assets and liabilities related to the Performance Chemicals segment are presented as assets of discontinued operations
and liabilities of discontinued operations in the Consolidated Balance Sheets for all periods presented. The cash flows and
comprehensive income related to the Performance Chemicals segment have not been segregated and are included in the
Consolidated Statements of Cash Flows and Comprehensive Income, respectively, for all periods presented. Amounts related to
the Performance Chemicals segment are consistently included or excluded from the Notes to the Consolidated Financial Statements
based on the respective financial statement line item. See Note 3 for additional information.
The company revised accumulated other comprehensive loss at January 1, 2013 to adjust for currency translation of $97 and
pension settlement charges of $54 that should have been recorded in prior years. The revision resulted in a $151 decrease in
accumulated other comprehensive loss with a corresponding reduction in reinvested earnings. The currency translation was related
to an adjustment to the exchange rates used by a foreign subsidiary in the translation of the financial statements to U.S. dollar
(USD) in prior years. See further discussion of the pension settlement charges in Note 18. The impact of these adjustments is not
material to the company's current or previously issued financial statements.
In February 2013, the company sold its Performance Coatings business (which represented a reportable segment). In accordance
with GAAP, the results of Performance Coatings are presented as discontinued operations and, as such, have been excluded from
continuing operations and segment results for all periods presented. The cash flows and comprehensive income related to the
Performance Coatings business have not been segregated and are included in the Consolidated Statements of Cash Flows and
Comprehensive Income, respectively, for all periods presented. See Note 3 for additional information.