Visa 2007 Annual Report Download - page 116

Table of Contents
VISA U.S.A. INC. AND SUBSIDIARIES
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
directors. Directors other than ex officio directors were elected in at-large voting by members in accordance with voting rights and director qualifications set
forth in the Company's bylaws. Under the amended Certificate of Incorporation, the directors served staggered terms of two years. Members represented on
the Board of Directors at September 30, 2007 accounted for 39% of total payments volume for the twelve months ended June 30, 2007. Visa U.S.A.'s
members, which are comprised of domestic banks and other financial institutions, represent 100% of the Company's payments volume.
The Company has one operating and reportable segment, "Payment Services," in the United States. The Company's activities are interrelated and each
activity is dependent upon and supportive of the other. Accordingly, all significant operating decisions are based on analysis of Visa U.S.A. as one operating
and reportable segment.
Note 2—Significant Accounting Policies
Basis of Presentation
Visa U.S.A. and its subsidiaries prepare their financial statements in conformity with accounting principles generally accepted in the United States of
America.
Consolidation
The consolidated financial statements include the accounts of Visa U.S.A. and its subsidiaries after elimination of intercompany accounts and
transactions. The Company consolidates entities when it has a greater than 50% ownership or when it exercises control. Minority interest is recorded for
consolidated entities in which the Company has less than 100% ownership interest. Minority interest represents the 31% equity interest in Inovant LLC which
is not owned by the Company.
Reclassifications
Certain reclassifications, not affecting net income, have been made to prior period information to conform to the current period presentation format.
Use of Estimates
The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires
management to make estimates and assumptions relating to the reporting of assets and liabilities and the disclosure of contingent assets and liabilities at the
date of the consolidated financial statements as well as the reported amounts of revenues and expenses during the reporting period. Actual results could differ
from those estimates. Such estimates include certain revenue discounts and volume-based support incentives, assumptions used in the determination of
pension and postretirement costs, discount rates used to estimate the present value of long-term obligations and assumptions used in the calculation of income
taxes, among others.
Cash, Cash Equivalents and Investments
Cash and cash equivalents include cash and certain highly liquid investments with original maturities of ninety days or less from the date of purchase.
Cash equivalents are recorded at cost, which approximates fair value. Investments with original maturities beyond ninety days and maturing in less than one
year are considered short-term investments. Investments with maturities in excess of one year are considered long-term investments.
115