Visa 2009 Annual Report Download - page 102

Download and view the complete annual report

Please find page 102 of the 2009 Visa annual report below. You can navigate through the pages in the report by either clicking on the pages listed below, or by using the keyword search tool below to find specific information within the annual report.

Page out of 172

  • 1
  • 2
  • 3
  • 4
  • 5
  • 6
  • 7
  • 8
  • 9
  • 10
  • 11
  • 12
  • 13
  • 14
  • 15
  • 16
  • 17
  • 18
  • 19
  • 20
  • 21
  • 22
  • 23
  • 24
  • 25
  • 26
  • 27
  • 28
  • 29
  • 30
  • 31
  • 32
  • 33
  • 34
  • 35
  • 36
  • 37
  • 38
  • 39
  • 40
  • 41
  • 42
  • 43
  • 44
  • 45
  • 46
  • 47
  • 48
  • 49
  • 50
  • 51
  • 52
  • 53
  • 54
  • 55
  • 56
  • 57
  • 58
  • 59
  • 60
  • 61
  • 62
  • 63
  • 64
  • 65
  • 66
  • 67
  • 68
  • 69
  • 70
  • 71
  • 72
  • 73
  • 74
  • 75
  • 76
  • 77
  • 78
  • 79
  • 80
  • 81
  • 82
  • 83
  • 84
  • 85
  • 86
  • 87
  • 88
  • 89
  • 90
  • 91
  • 92
  • 93
  • 94
  • 95
  • 96
  • 97
  • 98
  • 99
  • 100
  • 101
  • 102
  • 103
  • 104
  • 105
  • 106
  • 107
  • 108
  • 109
  • 110
  • 111
  • 112
  • 113
  • 114
  • 115
  • 116
  • 117
  • 118
  • 119
  • 120
  • 121
  • 122
  • 123
  • 124
  • 125
  • 126
  • 127
  • 128
  • 129
  • 130
  • 131
  • 132
  • 133
  • 134
  • 135
  • 136
  • 137
  • 138
  • 139
  • 140
  • 141
  • 142
  • 143
  • 144
  • 145
  • 146
  • 147
  • 148
  • 149
  • 150
  • 151
  • 152
  • 153
  • 154
  • 155
  • 156
  • 157
  • 158
  • 159
  • 160
  • 161
  • 162
  • 163
  • 164
  • 165
  • 166
  • 167
  • 168
  • 169
  • 170
  • 171
  • 172

Table of Contents
VISA INC.
NOTES TO CONSOLIDATED FINANCIAL STATEMENTS—(Continued)
September 30, 2009
(in millions, except as noted)
occur, the related gains and losses on the cash flow hedges are reclassified from accumulated other comprehensive income on the consolidated balance sheet
to administrative and other expense on the consolidated statement of operations at that time.
The Company's derivative financial instruments are subject to both credit and market risk. The Company monitors the credit-worthiness of the financial
institutions that are counterparties to its derivative financial instruments and does not consider the risks of counterparty nonperformance to be significant.
Notwithstanding the Company's efforts to manage foreign exchange risk, there can be no assurance that its hedging activities will adequately protect against
the risks associated with foreign currency fluctuations. Credit and market risks related to derivative instruments were not considered significant at
September 30, 2009.
Note 14—Enterprise-wide Disclosures and Concentration of Business
The Company's long-lived net property, equipment and technology assets are classified by major geographic area as follows:
September 30,
2009
September 30,
2008
(in millions)
U.S. $ 1,128 $ 1,014
Non-U.S. 76 66
Total $ 1,204 $ 1,080
Revenue by geographic market is primarily based on the location of the issuing bank. Certain revenues, primarily international service revenues, are
shared by geographic locations based upon the location of the merchant involved in the transaction. Visa does not maintain revenues by individual country,
other than the U.S. Revenue generated in the U.S. was approximately 58%, 59% and 92% of total operating revenues in fiscal 2009, 2008 and 2007,
respectively.
A significant portion of Visa's operating revenues are concentrated among its largest customers. Loss of business from any of these customers could
have an adverse effect on the Company. Revenues from the Company's top five customers were approximately 32%, 26% and 33% of total operating revenues
in fiscal 2009, 2008 and 2007, respectively. JPMorgan Chase accounted for 10% of the Company's net operating revenues in fiscal 2009. No other customer
accounted for 10% or more of total operating revenues. See Item 1A—Risk Factors.
Note 15—Stockholders' Equity
Reorganization, IPO and Redemptions
As part of the October 2007 reorganization, the Company issued different regional classes and series of common stock reflecting the different rights and
obligations of the Visa financial institution members and Visa Europe. The allocation of these shares to the participating regions was adjusted in the true-up
shortly prior to the IPO at which time the regional classes and series of common stock issued were converted into either class B or class C common stock. The
shares held by Visa Europe were not subject to the true-up, but were converted to class C (series II, III, and IV) common stock on a one-for-one basis
concurrent with the true-up.
101