National Oilwell Varco 2011 Annual Report Download - page 52

Index to Financial Statements
Recently Issued Accounting Standards
In May 2011, the Financial Accounting Standards Board (FASB) issued Accounting Standards Update (ASU) No. 2011-04, Amendments to Achieve Common Fair
Value Measurement and Disclosure Requirements in U.S. GAAP and IFRSs (ASU No. 2011-04), which provides guidance about how fair value should be applied where
it is already required or permitted under U.S. GAAP. The ASU does not extend the use of fair value or require additional fair value measurements, but rather provides
explanations about how to measure fair value. ASU No. 2011-04 requires prospective application and will be effective for interim and annual reporting periods beginning after
December 15, 2011. The Company is currently assessing the impact ASU No. 2011-04 will have on its financial statements, but does not expect a significant impact from
adoption of the pronouncement.
In June 2011, the FASB issued ASU No. 2011-05 Presentation of Comprehensive Income (ASU No. 2011-05), which eliminates the option to present components of
other comprehensive income as part of the statement of changes in equity and requires that all nonowner changes in equity be presented either in a single continuous statement
of comprehensive income or in two separate but consecutive statements. ASU No. 2011-05 requires retrospective application. The Company early adopted ASU No. 2011-05
and added the Consolidated Statements of Comprehensive Income retrospectively for all reporting periods presented.
In September 2011, the FASB issued ASU No. 2011-8 IntangiblesGoodwill and Other (ASU No. 2011-08), which amends its guidance on the testing of goodwill for
impairment allowing entities to perform a qualitative assessment on goodwill impairment to determine whether it is more likely than not (defined as having a likelihood of
more than 50 percent) that the fair value of a reporting unit is less than its carrying amount as a basis for determining whether it is necessary to perform the two-step goodwill
impairment test. This guidance is effective for goodwill impairment tests performed in interim and annual periods for fiscal years beginning after December 15, 2011, with
early adoption permitted. The Company is currently assessing the impact ASU No. 2011-08 will have on its financial statements, but does not expect a significant impact from
adoption of the pronouncement.
In December 2011, the FASB issued ASU No. 2011-11 Balance SheetDisclosures about Offsetting Assets and Liabilities (ASU No. 2011-11), which requires an entity
to disclose both gross and net information about financial instruments, such as sales and repurchase agreements and reverse sale and repurchase agreements and securities
borrowing/lending arrangements, and derivative instruments that are eligible for offset in the statement of financial position and/or subject to a master netting arrangement or
similar agreement. ASU No. 2011-11 is effective for annual and interim periods beginning on January 1, 2013. The Company is currently assessing the impact ASU
No. 2011-11 will have on its financial statements, but does not expect a significant impact from adoption of the pronouncement.
In December 2011, the FASB issued ASU No. 2011-12 Comprehensive IncomeDeferral of the Effective Date for Amendments to the Presentation of Reclassifications of
Items Out of Accumulated Other Comprehensive Income in Accounting Standards Update No. 2011-05 (ASU No. 2011-12), which defers changes in ASU No. 2011-05
that relate to the presentation of reclassification adjustments to allow the FASB time to redeliberate whether to require presentation of such adjustments on the face of the
financial statements to show the effects of reclassifications out of accumulated other comprehensive income on the components of net income and other comprehensive
income. ASU No. 2011-12 allows entities to continue to report reclassifications out of accumulated other comprehensive income consistent with the presentation requirements
in effect before ASU No. 2011-05. All other requirements in ASU No. 2011-05 are not affected by ASU No. 2011-12. ASU No. 2011-12 is effective for annual and interim
periods beginning after December 15, 2011. The Company is currently assessing the impact ASU No. 2011-12 will have on its financial statements, but does not expect a
significant impact from adoption of the pronouncement.
ForwardLooking Statements
Some of the information in this document contains, or has incorporated by reference, forward-looking statements. Statements that are not historical facts, including statements
about our beliefs and expectations, are forward-looking statements. Forward-looking statements typically are identified by use of terms such as may, will, expect,
anticipate, estimate, and similar words, although some forward-looking statements are expressed differently. All statements herein regarding expected merger synergies
are forward looking statements. You should be aware that our actual results could differ materially from results anticipated in the forward-looking statements due to a number
of factors, including but not limited to changes in oil and gas prices, customer demand for our products and worldwide economic activity. You should also consider carefully
the statements under Risk Factors which address additional factors that could cause our actual results to differ from those set forth in the forward-looking statements. Given
these uncertainties, current or prospective investors are cautioned not to place undue reliance on any such forward-looking statements. We undertake no obligation to update
any such factors or forward-looking statements to reflect future events or developments.
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