Equifax 2004 Annual Report Download - page 39

M A N A G E M E N T ’ S D I S C U S S I O N A N D A N A L Y S I S
O F F I N A N C I A L C O N D I T I O N A N D R E S U L T S O F O P E R A T I O N S
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Recognition.” While the wording of SAB 104 has changed
to refl ect the issuance of EITF 00-21, the revenue recogni-
tion principles of SAB 101 remain largely unchanged by
the issuance of SAB 104, which was effective upon issu-
ance. We implemented SAB 104 in December 2003 and it
did not have a material effect on our fi nancial position or
results of operations.
In May 2004, the FASB issued FSP No. 106-2 “Accounting
and Disclosure Requirements Related to the Medicare
Modernization Act of 2003.” This staff position supersedes
FSP No. 106-1 “Accounting and Disclosure Requirements
Related to the Medicare Prescription Drug, Improvement
and Modernization Act of 2003” by clarifying the guidance
on the recognition of the effects of the Act on employers
accumulated postretirement benefi t obligation. Employers
that sponsor a postretirement health care plan that provides
prescription benefi ts that are deemed actuarially equivalent
to the Medicare Part D benefi t are eligible for a federal sub-
sidy. This subsidy is to be treated as an actuarial experience
gain in the calculation of the accumulated postretirement
benefi t obligation. FSP 106-2 is effective for the fi rst interim
period or annual period beginning after June 15, 2004. We
adopted the accounting and disclosure provisions of FSP
106-2 in July 2004 and it did not have a material effect on
our fi nancial position or results of operations.
In July 2004, the EITF of the FASB reached consensus on
Issue No. 02-14 “Whether the Equity Method of Accounting
Applies When an Investor Does Not Have an Investment in
Voting Stock of an Investee but Exercises Signifi cant Infl uence
through Other Means.” EITF Issue No. 02-14 provides guid-
ance pertaining to an investor’s accounting when the investor
has signifi cant infl uence over an investee through means other
than voting stock. The provisions of EITF No. 02-14 apply to
reporting periods beginning after September 15, 2004. The
Company’s accounting for such investments has been consis-
tent with EITF 02-14 and its adoption during the fourth quar-
ter of 2004 did not have a material impact on our fi nancial
position or results of operations.
In December 2004, the FASB issued SFAS No. 123R
“Share-Based Payments.” SFAS 123R is a revision to
SFAS 123 “Accounting for Stock-Based Compensation”
and supersedes APB Opinion No. 25 “Accounting for Stock
Issued to Employees.” SFAS 123R establishes standards
for the accounting for all transactions in which an entity
exchanges its equity instruments for goods or services from
either employees or non-employees. This fi nancial account-
ing standard requires the cost resulting from share-based
payment transactions to be recognized in the entity’s fi nan-
cial statements as the goods are received or the services are
rendered, and establishes fair value as the measurement
objective for the accounting for such transactions. SFAS
123R is effective for public entities as of the beginning of
the fi rst interim or annual reporting period beginning after
June 15, 2005 and applies to (a) all new awards granted
after June 15, 2005; (b) modifi cations, repurchases or can-
cellations occurring after June 15, 2005, but pertaining to
awards granted before June 15, 2005; and (c) the unvested
service component of outstanding awards granted prior to
June 15, 2005. We will adopt the provisions of SFAS 123R
in our third quarter beginning July 1, 2005 and expect that
its impact on our fi nancial position or results of operations
will be in the range of our SFAS 123 pro forma amounts
disclosed in Note 1 of our Notes to our Consolidated
Financial Statements.
In December 2004, the FASB issued SFAS 153 “Exchanges
of Non-monetary Assets – An Amendment of APB Opinion
No. 29.” SFAS 153 amends APB 29 to eliminate the fair
value measurement principal exception for non-monetary
exchanges of similar productive assets and replaces it with
a general exception for exchanges of non-monetary assets
that do not have commercial substance. A non-monetary
exchange has commercial substance if the future cash fl ows
of the entity are expected to signifi cantly change as a result
of the exchange. SFAS 153 is effective for non-monetary
asset exchanges occurring in fi scal periods beginning after
June 15, 2005. We will adopt the provisions of SFAS 153
in July 2005 and do not expect that it will have a material
impact on our fi nancial position or results of operations.
In December 2004, the FASB issued FSP No. 109-2
“Accounting and Disclosure Guidance for the Foreign
Earnings Repatriation Provision within the American Jobs
Creation Act of 2004” (the “Act”). FSP 109-2 specifi cally
addresses the one-time tax deduction of 85% of certain
foreign earnings that are repatriated to the U.S. In accor-
dance with this FSP, an enterprise is allowed time beyond
the fi nancial reporting period covering the enactment of
the Act, to evaluate the effect of the Act on its plan for
reinvestment or repatriation of foreign earnings for pur-
poses of applying SFAS 109. FSP 109-2 requires the fol-
lowing disclosures for an enterprise that has not completed
its evaluation of the repatriation provisions: (a) a summary
of the repatriation as it applies to the enterprise; (b) the
expected completion date of the evaluation; (c) the expected