E-Z-GO 2009 Annual Report Download - page 64

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Textron Inc.
The intangible assets we acquired with UIC represent primarily customer agreements and contractual relationships with a weighted-average
useful life of 13 years. We have allocated the purchase price of this business to the estimated fair value of the net tangible and intangible assets
acquired, with any excess recorded as goodwill. Approximately $64 million of the goodwill is deductible for tax purposes. In 2008, the goodwill
and intangible amounts were adjusted to reflect the final fair value adjustments, which resulted in a reduction of goodwill of $49 million, net of
deferred taxes, and an increase in intangible assets of $14 million.
Note 4. Accounts Receivable
Accounts receivable is comprised of the following:
January 2, January 3,
(In millions) 2010 2009
Commercial $ 470 $ 496
U.S. Government contracts 447 422
917 918
Allowance for doubtful accounts (23) (24)
$ 894 $ 894
We have unbillable receivables on U.S. Government contracts that arise when the revenues we have appropriately recognized based on
performance cannot be billed yet under terms of the contract. Unbillable receivables within accounts receivable totaled $170 million at January 2,
2010 and $157 million at January 3, 2009. Long-term contract receivables due from the U.S. Government exclude significant amounts billed but
unpaid due to contractual retainage provisions.
Note 5. Finance Receivables and Securitizations
Our Finance group manages and services finance receivables for a variety of investors, participants and third-party portfolio owners. We do not
have a retained financial interest or credit risk in the performance of the serviced portfolio, and, therefore, performance of these portfolios is
limited to billing and collection activities. A reconciliation of our managed and serviced finance receivables to finance receivables held for
investment, net is provided below:
January 2, January 3,
(In millions) 2010 2009
Total managed and serviced finance receivables $ 8,283 $ 12,173
Less: Nonrecourse participations sold to independent investors 765 820
Less: Third-party portfolio servicing 463 532
Total managed finance receivables 7,055 10,821
Less: Securitized receivables 30 2,248
Owned finance receivables 7,025 8,573
Less: Finance receivables held for sale 819 1,658
Finance receivables held for investment 6,206 6,915
Allowance for loan losses (341) (191)
Finance receivables held for investment, net $ 5,865 $ 6,724
Finance receivables held for investment at January 2, 2010 and January 3, 2009 include approximately $629 million and $1.1 billion of
receivables that have been legally sold to special purpose entities (SPE), which are consolidated subsidiaries of TFC. The assets of the SPEs are
pledged as collateral for their debt, which is reflected as securitized on-balance sheet debt in Note 8. Third-party investors have no legal recourse
to TFC beyond the credit enhancement provided by the assets of the SPEs.
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