Equifax 2012 Annual Report Download - page 50

48 Equifax 2012 Annual Report
quoted prices in active markets, inputs other than quoted prices with
observable market data and unobservable data (e.g., a company’s
own data). The adoption of fair value guidance for nonfinancial assets
and nonfinancial liabilities on January 1, 2009 did not have a material
impact on our Consolidated Financial Statements.
The following table presents assets and liabilities measured at fair
value on a recurring basis:
Fair Value Measurements at
Reporting Date Using:
Description
Fair Value at
December 31,
2012
Quoted Prices
in Active
Markets for
Identical
Assets
(Level 1)
Significant
Other
Observable
Inputs
(Level 2)
Significant
Unobservable
Inputs
(Level 3)
(In millions)
Assets and
Liabilities:
Fair Value Interest
Rate Swaps
(1)
$ 12.2 $— $ 12.2 $—
Notes, due
2014
(1)
(287.2) — (287.2) —
Deferred
Compensation
Plan
(2)
(16.8) — (16.8) —
Total assets and
liabilities $(291.8) $— $(291.8) $—
(1) The fair value of our interest rate swaps, designated as fair value
hedges, and notes are based on the present value of expected
future cash flows using zero coupon rates and are classified
within Level 2 of the fair value hierarchy.
(2) We maintain deferred compensation plans that allow for certain
management employees to defer the receipt of compensation
(such as salary, incentive compensation and commissions) until
a later date based on the terms of the plans. The liability
representing benefits accrued for plan participants is valued at
the quoted market prices of the participants’ investment
elections.
Variable Interest Entities. We hold interests in certain entities,
including credit data and information solutions ventures, that are
considered variable interest entities, or VIEs. These variable interests
relate to ownership interests that require financial support for these
entities. Our investments related to these VIEs totaled $13.5 million at
December 31, 2012, representing our maximum exposure to loss.
These investments are classified in other assets, net on our
Consolidated Balance Sheets. We are not the primary beneficiary and
are not required to consolidate any of these VIEs.
Recent Accounting Pronouncements. Testing Goodwill for Impair-
ment. In September 2011, the FASB issued Accounting Standards
Update, Intangibles — Goodwill and Other (Topic 350): Testing
Goodwill for Impairment (the revised standard). The revised standard
is intended to reduce the cost and complexity of the annual goodwill
impairment test by providing entities an option to perform a ‘‘qualita-
tive’’ assessment to determine whether further impairment testing is
necessary. If an entity believes, as a result of its qualitative assess-
ment, that it is more-likely-than-not that the fair value of a reporting
unit is less than its carrying amount, the quantitative impairment test
is required. Otherwise, no further testing is required. The revised
standard was effective for annual and interim goodwill impairment
tests performed for fiscal years beginning after December 15, 2011.
We implemented the new standard in our 2012 annual goodwill
impairment testing, and it did not have a material effect on our
financial condition or results of operations.
Comprehensive Income. In the first quarter of 2012, we adopted
Accounting Standards Update No. 2011-05, Presentation of
Comprehensive Income, which changed our financial statement
presentation but did not have an effect on our financial condition or
results of operations.
Testing Indefinite-Lived Intangible Assets for Impairment. In
July 2012, the FASB issued Accounting Standards Update No. 2012-
02, ‘‘Intangibles — Goodwill and Other (Topic 350): Testing Indefinite-
Lived Intangible Assets for Impairment,’’ which allows a company the
option to first assess qualitative factors to determine whether it is
necessary to perform a quantitative impairment test. Under that
option, a company would no longer be required to calculate the fair
value of an indefinite-lived intangible asset unless the company
determines, based on the qualitative assessment, that it is more likely
than not that the fair value of the indefinite-lived intangible asset is
less than its carrying amount. This guidance is effective for annual
and interim indefinite-lived intangible asset impairment tests
performed for fiscal years beginning after September 15, 2012. Early
adoption is permitted. We will implement the new standard in our
2013 annual impairment testing. This guidance is not expected to
have a material effect on our financial condition or results
of operations.
Other Comprehensive Income. In February 2013, the FASB issued
Accounting Standards Update No. 2013-02, ‘‘Reporting of Amounts
Reclassified Out of Other Comprehensive Income,’’ which requires
public companies to present information about reclassification adjust-
ments from accumulated other comprehensive income in their annual
and interim financial statements in a single note or on the face of the
financial statements. This standard is effective prospectively for
annual and interim reporting periods beginning after December 15,
2012. This guidance is not expected to have a material effect on our
financial condition or results of operations.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS continued