Visa 2012 Annual Report Download - page 44

Table of Contents
impact of a large issuer converting away from the platform entirely in June 2010. The decline in marketing expense also
reflects the absence of spending associated with the 2010 Winter Olympics and the 2010 FIFA World Cup incurred in the
prior year. The decline was partially offset by the inclusion of CyberSource activity.
The increase in fiscal 2011 primarily reflects the impact of newly acquired technology and intangible assets from our
acquisitions of CyberSource and PlaySpan in July 2010 and March 2011, respectively, offset by the absence of
depreciation and amortization on the incremental basis in assets recorded in our October 2007 reorganization, as these
assets were fully depreciated as of September 30, 2010. See Note 5—Acquisitions to our consolidated financial
statements.
The increase in fiscal 2011 is primarily due to increased travel and the inclusion of CyberSource activity, combined with
reserves for a potential government assessment in one of our international geographies in fiscal 2011.
Other Income (Expense)
The following table sets forth the components of our other income (expense) for the periods presented.
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• Professional fees increased in fiscal 2012 and 2011 , primarily reflecting greater investment in technology projects to
support our eCommerce and mobile initiatives.
• Depreciation and amortization increased in fiscal 2012 , primarily due to additional depreciation expense from our
ongoing investments in technology assets and infrastructure to support our core business as well as our eCommerce and
mobile initiatives.
• General and administrative
increased primarily due to travel activities in support of our international expansion, combined
with the absence of unrealized foreign exchange gains recorded in fiscal 2011 upon the remeasurement of monetary
asset and liabilities held by foreign subsidiaries into their functional currencies.
• Litigation provision in fiscal 2012 reflects a $4.1 billion accrual related to litigation covered by the retrospective
responsibility plan. The credit to the provision in fiscal 2010 was primarily the result of a $41 million pre-tax gain
recognized related to the prepayment of the remaining obligations under the Retailers’ litigation settlement, combined
with the release of accruals for certain other legal matters settled during fiscal 2010. See
Note 2—Retrospective
Responsibility Plan and Note 21—Legal Matters to our consolidated financial statements.
Fiscal Year ended
September 30,
$ Change
% Change
(1)
2012
2011 2010
2012
vs.
2011
2011
vs.
2010
2012
vs.
2011
2011
vs.
2010
(in millions, except percentages)
Interest income (expense)
$
29
$
(32
)
$
(72
)
$
61
$
40
NM
(55
)%
Investment income
36
108
49
(72
)
59
(67
)%
NM
Other
3
124
72
(121
)
52
(98
)%
73
%
Total Other Income (Expense)
$
68
$
200
$
49
$
(132
)
$
151
(66
)%
NM
(1)
Figures in the table may not recalculate exactly due to rounding. Percentage changes are calculated based on whole numbers,
not the rounded numbers presented.
• Interest income for fiscal 2012 reflects the reversal of previously accrued interest associated with tax reserves for
uncertainties related to the deductibility of covered litigation expense. Interest expense in fiscal 2011 reflects lower
interest accretion due to declining litigation balances as well as the reversal of previously accrued interest upon the
effective settlement of uncertainties surrounding the timing of certain deductions for income tax purposes. See Note 20—
Income Taxes and Note 21—Legal Matters to our consolidated financial statements.
• Investment income includes pre-tax gains of $85 million recognized in fiscal 2011 upon the sale of our investment in Visa
Vale issuer Companhia Brasileira de Soluções e Serviços, or CBSS, and $20 million