Equifax 2002 Annual Report Download - page 37

MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
an adverse outcome from any claim or legal proceeding is probable
and the amount can be estimated, we accrue a liability for esti-
mated legal fees and settlements in accordance with SFAS No. 5,
“Accounting for Contingencies.”
INCOME TAXES
We account for income taxes in accordance with SFAS No. 109,
“Accounting for Income Taxes.” As part of the process of preparing
our consolidated financial statements, we are required to estimate
our income taxes in each of the jurisdictions in which we operate.
This process involves us estimating our current tax exposure
together with assessing temporary differences resulting from dif-
fering treatment of items for tax and accounting purposes. These
differences result in deferred tax assets and liabilities, which are
included in our consolidated balance sheet. We must then assess
the likelihood that our deferred tax assets will be recovered from
future taxable income, and, to the extent we believe that recovery
is not likely, we must establish a valuation allowance. To the extent
we establish a valuation allowance or increase this allowance in
a period, we must include an expense within the tax provision in
the statement of operations. A valuation allowance is currently set
against deferred tax assets because we believe it is more likely
than not that the deferred tax assets will not be realized through
the generation of future taxable income. Significant management
judgment is required in determining our provision for income taxes
and our deferred tax assets and liabilities and our future taxable
income for purposes of assessing our ability to realize any future
benefit from our deferred tax assets. In the event that actual
results differ from these estimates or we adjust these estimates in
future periods, our operating results and financial position could be
materially affected.
RETIREMENT PLANS
Our pension plans and postretirement benefit plans are accounted
for using actuarial valuations required by SFAS No. 87, “Employers’
Accounting for Pensions,” and SFAS No. 106, “Employers’ Account-
ing for Postretirement Benefits Other Than Pensions.” Our pension
and postretirement benefit liabilities were approximately $117.0 mil-
lion or 9% of the total liabilities on our consolidated balance sheet
as of December 31, 2002. We consider accounting for retirement
plans critical to all of our operating segments because our manage-
ment is required to make significant subjective judgments about a
number of actuarial assumptions, which include discount rates,
health care cost trends rates, salary growth, long-term return on
plan assets and mortality rates. Depending on the assumptions and
estimates used, the pension and postretirement benefit expense
could vary within a range of outcomes and have a material effect on
our consolidated financial statements.
FORWARD-LOOKING STATEMENTS
As used herein, the terms “Equifax,” “we,” “our,” and “us” refer to
Equifax Inc., a Georgia corporation, and its consolidated subsidiaries
as a combined entity, except where it is clear that the terms mean
only Equifax Inc.
This Annual Report contains forward-looking statements within
the “safe harbor” provisions of the Private Securities Litigation
Reform Act of 1995, Section 27A of the Securities Act of 1933, and
Section 21E of the Securities Exchange Act of 1934. In addition,
certain statements included in our future filings with the Securities
and Exchange Commission (the “SEC”), in press releases, and in
oral and written statements made by us or with our approval, that
are not statements of historical fact, are forward-looking state-
ments. Words such as “may,” “could,” “should,” “would,”
“believe,” “expect,” “anticipate,” “estimate,” “intend,” “seeks,”
“plan,” “project,” “continue,” “predict,” and other words or
expressions of similar meaning are intended to identify forward-
looking statements, although not all forward-looking statements
contain these identifying words. These forward-looking statements
are found at various places throughout this report and in the docu-
ments incorporated herein by reference. These statements are
based on our current expectations about future events or results
and information that is currently available to us, involve assump-
tions, risks and uncertainties, and speak only as of the date on
which such statements are made. We disclaim any intention or obli-
gation to update or revise any forward-looking statements, whether
as a result of new information, future events, or otherwise.
Our actual results may differ materially from the results discussed
in such forward-looking statements. Factors that may cause such a
difference, include, but are not limited to: declines in the rate of
growth, or absolute declines, in consumer spending and consumer
debt in our market areas; changes in the marketing techniques of
credit card issuers; increased pricing pressures; changes in or
failure to comply with U.S. and international legislation or govern-
mental regulations, including the Fair Credit Reporting Act and
Gramm-Leach-Bliley Act; successful integration of acquisitions;
exchange rate fluctuations and other risks associated with invest-
ments and operations in foreign countries; increased domestic or
international competition; our ability to successfully develop and
market new products and services, successful incorporation of
new technology and adaptation to technological change and
equity markets, including market disruptions and significant inter-
est rate fluctuations, which may impede our access to, or increase
the cost of, external financing; increased competitive pressures
both domestically and internationally; and international conflict,
including terrorist acts and other risks and unforeseen factors,
including those described in this Annual Report and the documents
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