Ford 2011 Annual Report Download - page 126

Notes to the Financial Statements
124 Ford Motor Company | 2011 Annual Report
NOTE 13. VARIABLE INTEREST ENTITIES (Continued)
Finance receivables
Retail
Wholesale
Total finance receivables
Net investment in operating leases
Total (a)
2010
Cash and Cash
Equivalents
$2.9
0.4
3.3
0.8
$4.1
Finance
Receivables, Net
and
Net Investment in
Operating Leases
$33.9
16.6
50.5
6.1
$56.6
Debt
$27.1
10.1
37.2
3.0
$40.2
__________
(a) Certain notes issued by the VIEs to affiliated companies served as collateral for accessing the ECB open market operations program. This external
funding of $334 million at December 31, 2010 was not reflected as debt of the VIEs and is excluded from the table above, but was included in our
consolidated debt. The finance receivables backing this external funding are included in the table above.
Ford Credit's exposure based on the fair value of derivative instruments related to consolidated VIEs that support its
securitization transactions at December 31 was as follows (in millions):
VIE – Securitization entities
Ford Credit related to VIE
Total including Ford Credit related to VIE (a)
2011
Derivative
Asset
$157
81
$238
Derivative
Liability
$97
63
$160
2010
Derivative
Asset
$26
134
$160
Derivative
Liability
$222
37
$259
__________
(a) Ford Credit derivative assets and liabilities are included in Other assets and Accrued liabilities and deferred revenue, respectively, on our
consolidated balance sheet.
The financial performance of the consolidated VIEs that support Ford Credit's securitization transactions reflected in
our statement of operations for the years ended December 31 was as follows (in millions):
VIEs financial performance
2011
Derivative
Expense
$31
Interest
Expense
$994
2010
Derivative
Expense
$225
Interest
Expense
$1,247
2009
Derivative
Expense
$339
Interest
Expense
$ 1,678
VIEs of which we are not the primary beneficiary:
Ford Credit has an investment in Forso Nordic AB, a joint venture determined to be a VIE of which we are not the
primary beneficiary. The joint venture provides consumer and dealer financing in its local markets and is financed by
external debt and additional subordinated debt provided by the joint venture partner. The operating agreement indicates
that the power to direct economically significant activities is shared with the joint venture partner, and the obligation to
absorb losses or right to receive benefits resides primarily with the joint venture partner. Our investment in the joint
venture is accounted for as an equity method investment and is included in Other assets. Our maximum exposure to any
potential losses associated with this VIE is limited to its equity investment, and amounted to $71 million at
December 31, 2011 and 2010.