Financial Accounting Ch07

$ , 0 ! . 616)6+1)4!-87:;B

%GMABLOB=>H,KH?>LLHK&H>$HRE>BGMKH=NLMA>>LL>GMB:EIHBGMLK>=BG A:IM>K

*0)/.- $1' )) /- '$5' 1'0

" ( $ $ % * , )

MMA>>G=H?MABLL>GMLLAHNE=;>:;E>MHF>>MMA>?HEEHPBG@H;C>L

+@67DEF3@6F:3F355AG@FED757;H34>73D7D7BADF763F@7FD73>;L34>7H3>G7

!@AIF:3F@7FD73>;L34>7H3>G7;E3@7EF;?3F;A@A8F:73?AG@FA853E:FA475A>>75F768DA?3

B3DF;5G>3D3EE7F BBD75;3F7F:75:3>>7@97F:3FG@57DF3;@FKBAE7E;@F:7D7BADF;@9A8355AG@FED757;H34>7 ";EFF:7835FADEFA475A@E;67D764KAT5;3>EI:7@7EF;?3F;@9F:7@7FD73>;L34>7H3>G7A8A83

5A?B3@KNE355AG@FED757;H34>7

-=HGJLAF?;;GMFLK-=;=AN9:D=

(G7EF;A@ +:7 9A3> A8 V@3@5;3> 355AG@F;@9 ;E FA B3;@F 3 83;D>K BD7E7@F76 BADFD3;F F:3F 7@34>7E 675;E;A@?3=7DE FA ?3=7 3 D73EA@34>7 3EE7EE?7@F A8 3@ AD93@;L3F;A@QE V@3@5;3> :73>F: 3@6 8GFGD7 BDAEB75FE +:;E>;=7@7EE E:AG>6 47 5A??G@;53F76 43E76 A@ 3 E7F A8 97@7D3>>K 3557BF76 355AG@F;@9 BD;@5;B>7E 7;F:7D ,*' AD )* I;F: @A ?3F7D;3> ?;EEF3F7?7@FE ;@5>G676 +:7 EG557EE A8 F:7 5A@H7K3@57 ;E 67B7@67@F A@F:734;>;FKA8F:7355AG@F3@FEFABD7B3D7V@3@5;3>EF3F7?7@FEF:3F?77FF:;ED;9ADAGEEF3@63D6

CG3>>K 3E ;?BADF3@F 7H7DK B3DFK 3@3>KL;@9 F:7 D7EG>F;@9 EF3F7?7@FE ?GEF BAEE7EE F:7 =@AI>7697 @757EE3DK FA G@67DEF3@6 F:7 ?G>F;FG67 A8 D7BADF76 V9GD7E 3@6 7JB>3@3F;A@E 8 3BBDABD;3F7 675;E;A@E 3D7 FA

2B>PMA>OB=>HHGEBG>:MAMMI;BMERAHRE>

2013 Flat World Knowledge, Inc. All rights reserved. Created exclusively for [email protected]

355AG@FED757;H34>7

G:LL>MMA:MK>IHKMLMA>:FHNGML@>G>K:M>=;R=BML:E>LMA:M:K>LMBEEHP>=MH:GHK@:GBS:MBHG;RBMLKL

@7FD73>;L34>7H3>G7

0A>:FHNGMH?QI>=MH;>@>G>K:M>=;R:G:LL>M:?M>KLL:KRMHH;M:BGMA>K>FHO>=:LK>E:M>=MH:BMBLMA>:FHNGM:GHK@:GBS:MBHG>LMBF:M>LPBEENEMBF:M>ER;>=?KHFKL

D7EG>F 43E76 A@ F:;E ;@8AD?3F;A@ 4AF: F:7 BD7B3D7D 3@6 F:7 D7367D @776 3@ ;@67BF: =@AI>7697 A8 F:7 D7BADF;@9EF3@63D6E

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

(G7EF;A@ E 6;E5GEE76 ;@ BD7H;AGE 5:3BF7DE ?3@K A8 F:7 V9GD7E D7BADF76 ;@ V@3@5;3> 355AG@F;@9 53@@AF47 34EA>GF7>K 5ADD75F >F:AG9: 4;>>;A@ ;E F:7 3EE7F 43>3@57 E:AI@ 4K .55 F:7 53E: 7H7@FG3>>K 5A>>75F76 I;>> >;=7>K 47 EA?7I:3F :;9:7D AD >AI7D #18>5- =1. 5*,4 8/ .A*,=7. _F9F;A9D KL9L=E=FLK AF 9;;GJ

L@= J=HGJL=< 9EGMFLK G> J=N=FM=K 9F< =PH=FK=K

* ) * / % + ( ) "

'G7EF;A@

#>KPBMS HKIHK:MBHG F:GN?:L :G= L>EEL LAH>L M MA> >G= H? MA> GM R>:K MA> L>GMER :LL>LLBG@ MA> :FHNGM H? NG :ERMH;>K>E>O:GMBG?HKF:MBHGBGF:DBG@MABL>LMBF:MBHG

: GMK>LLBHGBLM:DBG@IE:BGMA>GMHKRE>O>ELO>KR?NEER< 0A>EELMHKLPAHA:O>NG=>K@HG>:G>QM>GLBO>=BMK>BO:;E>LA>E=HGMA>IK>OBHNL;:E:GLA>>M=:M>I>KGMP>K>G>O>K=

@EI7D

0A>KBLGMHKRE>O>ELO>KR?NEER

JB>3@3F;A@

HFI:GB>L LMN=R :L FNE>O:GM BG?HKF:MBHG :L IHLLB;E> BG >LMBF:MBG@ NG :OBHNL G=L%G :==BMBHG MA> F>MAH=L ;R PAB QM>G=L =BM :G= INLA>L ?HK I:RF>GM K>BO>= EMAHN@A FHGBMHKBG@ BGO>GMHKR E>O>EL BL BFIHKM:GM ;> BM =N MA>?M :G=;K>:D:@>GHBG?HKF:MBHGBLIKHOB=>=:LMHMA>BO:;E>L

! / * ! - /

> H? O:KBHNL NGKM:BGMB>L F:GR H? MA> `@NK>L K>IHKM>= BG : L>M H? `G:GF>GML K>IK>L>GM >LMBF:MBHGL 0A>K>?HK> :L =BL= IK>OBHNLER LNL >Q: PBMA LN := ;:E:GL KB:E FBLLM:M>F>GML BL LAHPG :M BML G>M K>:EBS:;E> O:EN> MA> :FHNGM H? QI>= MH ;> =(HLL>L ?KHF ;:= :FHO>= ;:L>= HG ABLMHKBG=L :G= HMA>K K>E>O:GM BG?HKF:MBHG 0ANL MA> `@NK> K>IHKM>= BG MA> :LL>M L> ;:E:G LA>>M BL EHP>K MA:G MA> MHM:E :FHNGM H? K>BO:;E>LA>E=;RMA>

*0)/$)"!*-0)*'' /$' *0)/.

" ( $ $ % * , )


+@67DEF3@6F:7D73EA@8ADD7BADF;@93E7B3D3F73>>AI3@57355AG@FA@F:743>3@57E:77F;@5A@@75F;A@I;F:355AG@FED757;H34>7

!@AIF:3F436674F7JB7@E7E?GEF473@F;5;B3F763@6D75AD676;@F:7E3?7F;?7B7D;A63EF:7D7>3F76E3>7ED7H7@G7FA5A@8AD?FAF:7?3F5:;@9BD;@5;B>7

&D7B3D7F:7367FA@7FD73>;L34>7H3>G73@6D75A9@;L7F:7D7EG>F;@9436674F7JB7@E7

/@=DDGO9F;=>GJGM:L>MD;;GMFLK

(G7EF;A@ 3E76 A@ F:7 ;@8AD?3F;A@ BDAH;676 4K .55 7, 5A?B3@;7E E77? FA ?3;@F3;@ FIA E7B3D3F7>7697D 355AG@FE ;@ AD67D FA D7BADF 355AG@FE D757;H34>7E 3F @7F D73>;L34>7 H3>G7 &@7 ;E F:7 EG? A8 3>> 355AG@FE AGFEF3@6;@9 3@6 F:7 AF:7D ;E 3@ 7EF;?3F;A@ A8 F:7 3?AG@F I;F:;@ F:7 FAF3> F:3F I;>> @7H7D 47 5A>>75F76 @F7D7EF;@9>K F:7 VDEF ;E 3 835F 3@6 F:7 E75A@6 ;E 3@ AB;@;A@ +:7 FIA 3D7 F:7@ 5A?4;@76 FA 3DD;H7 3FF:7 @7F D73>;L34>7 H3>G7 V9GD7 E:AI@ A@ F:7 43>3@57 E:77F < =1. *68>7= ;.98;=.- /8; *,,8>7=< ;.,.2?*+5.*,=>*55B=1.7.=8/=1.=8=*5->./;86,>GJJ=HGJLAF?HMJHGK=K#GO=N=JL@9LD=N=DG>;=JL9AFLQAKJ9J=DQHGKKA:D=

$$"%+$*$,()%$


3>>AI3@578AD6AG4F8G>355AG@FE

M::FHNGMH?:MA:MMA>K>IHKMBG@LMBF:M>LPBEE>O>GMN:EER?:BEMH;>=:ELHK>?>KK>=MH:LMA>:EEHP:G?HKNG:IHKM>=:LMA>MHM:E;:E:GMH:G>M:FHNGMBGMABLKMA>:EEHP:G?HK=HN;M?NE:IHKM>=:MHMA>:FHNGM>QI>=MH;>=

436674F7JB7@E7

!LMBF:M>=>QI>GL>?KHFF:DBG@L:E>LHG:KI:R;>H?MA>F:M>QI>GL>BLK>=BGMA>L:F>I>KBH=:LMA>L:E>LK>O>GN>

< F9;;GMFLKJ=;=AN9:D=/9;;GMFLEGFALGJKL@=LGL9DJGE9DDG>9;GEH9FQXK;MKLGE=JK

< K=;GFL=F;9DD=

97 4GF A@>K 7JB75FE FA 5A>>75F 43E76A@ 3H3;>34>7 7H;67@57 +:7 D76G5F;A@ ;@ F:7 3EE7F ;E 3@ 7JB7@E7 .:7@ E:AG>6 F:7 7JB7@E7 47 D75A9@;L76 +:7E7 E3>7E I7D7 ?367 ;@ 073D &@7 4GF F:7 EB75;V5 ;67@F;FK A8 F:7 5GEFA?7DE I:A 83;> FA B3K 3@6F:7 35FG3> G@5A>>75F;4>7 3?AG@FE I;>> @AF 47 67F7D?;@76 G@F;> 073D +IA #18>5- +*- -.+= .A9.7

* ) * / % + ( ) "

'G7EF;A@

G>K:E E>=@>K BGL : ;:E:G ?HK ;:= =>;M >QI>GL> :G= :GHMA>K ?HK MA> :EEHP:G ?HK=HN;M?NE:GMLBLMKN>

: HMA;:==>;M>QI>GL>:G=MA>:EEHP:G?HK=HN;M?NE:IHKM>=HGMA>BGLM:M>F>GM; HMA;:==>;M>QI>GL>:G=MA>:EEHP:G?HK=HN;M?NE:IHKM>=HGMA>;:E:GLA>>M< :==>;M>QI>GL>BLK>IHKM>=HGMA>BGLM:M>F>GMMA>:EEHP:G?HK=HN;M?NE:=

HGMA>;:E:GLA>>M= :==>;M>QI>GL>BLK>IHKM>=HGMA>;:E:GLA>>MMA>:EEHP:G?HK=HN;M?NE:=HG

MA>BGLM:M>F>GM

@EI7D

0A> K BL QI>GL> BL K>IHKM>= HG MA> BG LM:M>F>GM MA> :EEHP:G ?HK=HN;M?NE:=HGMA>;:E:GLA>>M

JB>3@3F;A@

:= =>;M >QI>GL> BL K>IHKM>= HG MA> BG LM:M>F>GM MH LAHP MA> :FHNGM H? L:E>L K>= MABL R>:K MA:MMA> LMBF:M>L PBEE GHM ;> = 0A> :EEHP:G ?HK =HN;M?NE :>MMHK>=N:MHMA>BK>LMBF:M>=G>MK>:EBS:;E>O:EN>

/@=)==GJ9.=H9J9L=DDGO9F;=;;GMFL

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`G:GF>GML :K> IK>I:K>= :G >LMBF:MBHG H? MA>NG :FHNGML BL F:=> :G= :G :=CNLMBG@ >GMKR K>= 0ANL MA> >QI>GL> MA> :EEHP:G ::EEIK>L>GM>=:

/# +-*' (2$/# ./$(/$*).

" ( $ $ % * , )


(75AD6F:7;?B35FA86;E5AH7D;@9F:3F3EB75;R5D757;H34>7;EG@5A>>75F;4>7

+@67DEF3@6F:7D73EA@3@7JB7@E7;E@AFD75A9@;L76I:7@3D757;H34>7;E677?76FA47

G@5A>>75F;4>7 (75AD6F:75A>>75F;A@A83D757;H34>7F:3F:3EBD7H;AGE>K477@ID;FF7@AQ3EG@5A>>75F;4>7 (75A9@;L7F:3F7EF;?3F76R9GD7EA8F7@BDAH7FA477DDA@7AGE4GF5:3@97E;@BD7H;AGEK73D

R9GD7E3D7@AF?367;8F:7D7BADF7643>3@57I3E3D73EA@34>77EF;?3F7

/@=2JAL=*>>G>9F0F;GDD=;LA:D=;;GMFL

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

* ) * / % + ( ) "

'G7EF;A@

*>:K MA> >G= H? 5>:K +G> : @BGGBG@ MH IK>I:K> `G:GF>GML MHM:E ;NM MA> G>M K>:EBS:;E> O:EN> BL HGER >QI>= MH ;> +G MA> E:LM =:R H? MA> R>:K MA> :EBS>L MA:M : K>BO:;E> A:L ;> PHKMAE>LL :G= FNLM ;> PKBMM>G H_ 0A> =>;MHK A:= =>=;:GDKNIMO>K;>:;E>MHI:R3A:MBLMA>BFI:G>M:FHNGMK>IHKM>=?HKK>BO:;E>L@H>L=HPG; 0A>G>M:FHNGMK>IHKM>=?HKK>BO:;E>LLM:RLMA>L:F>< 0A>G>M:FHNGMK>IHKM>=?HKK>BO:;E>L@H>LNI= R>:KBGMABLF:GG>K

@EI7D

0A>KBLG>M:FHNGMK>IHKM>=?HKK>BO:;E>LLM:RLMA>L:F>

JB>3@3F;A@

0A> :EEHP:G ?HK =HN;M?NE :M K>:EBS:;E> O:EN> H? 3KBMBG@H_ : : K>BO:;E> MHM:E ?KHF MH %G :==BMBHG MA> :EEHP:G =KHIL?KHF MH 0A> G>M ;:E:G MH ;> K>IHKM>= K>F:BGL E>LL 0A> QI>L :G= K>IHKML MA:M ;:E:G 3KBMBG@ :G :

GDD=;LAF?;;GMFLK+J=NAGMKDQ2JALL=F*>>

(G7EF;A@ @ 355AG@F D757;H34>7 ;E 7,855.,=2+5.-8. EGF=Q AK =N=J J=;=AN=< >JGE 9OJALL=F G^ 9;;GMFL L@= ;GEH9FQ _JKL J=AFKL9L=K L@= 9;;GMFL :Q J=N=JKAF? L@= =9JDA=J =FLJQ !A?MJ= /@=F L@= ;9K@ J=;=AN=< AK J=;GJ9K@AGF !A?MJ= /@= LOG =FLJA=K K@GOF @=J= 9J=9HHJGHJA9L= A> L@= 9:GN= 9;;GMFL AK =N=FLM9DDQ ;GDD=;L=< >JGE L@AK ;MKLGE=J .GE= ;GEH9FA=K ;GE:AF=L@=K= =FLJA=K :Q KAEHDQ K*:AG9:FFA7-ADF:>7EE

+( AGD@3>@FDKMA>>75F;A@A8(7;@EF3F7655AG@F12

-=HGJLAF?9F$F;GJJ=;L KLAE9LAGF

(G7EF;A@ @ F:;E ;>>GEFD3F;A@ 3F F:7 7@6 A8 073D &@7 F:7 5A?B3@K 7EF;?3F76 F:3F A8 ;FE 355AG@FED757;H34>7 I;>> G>F;?3F7>K BDAH7 FA 47 G@5A>>75F;4>7 AI7H7D ;@ 073D +IA F:3F V9GD7 ;E >;=7>K FA 47

&*($$$"(&%(*$-*$%(#*%$)%$,/%+*(,")


BDAH7@ IDA@9 F ;E ?7D7>K 3 53>5G>3F76 9G7EE +:7 35FG3> 3?AG@F ?;9:F 47 AD AD ?3@K AF:7D @G?47DE .:7@ F:7 BD75;E7 V9GD7 ;E =@AI@ 6A7E 3 5A?B3@K D7FGD@ FA ;FE 073D &@7 V@3@5;3> EF3F7?7@FE 3@6 363@57 #18>5- * ,869*7B ,87=27>. ;.98;=270 *7 .;./8;*9;.?28>

+( @6A8/73D*IAM)3>7E(757;H34>7E3@63674F3>3@57E

-=KAGJGM:L>MD;;GMFLK

(G7EF;A@ @ F:7 +355AG@FE ;@ ;9GD7 F:7 43>3@57E D7BD7E7@F 355AG@F FAF3>E 8AD 073D +IA BD;AD FAK73D7@6 363@57 A8 3BB73D ;@ F:7 3>>AI3@57 8AD 6AG4F8G> 355AG@FE 478AD7 D75AD6;@9 F:7 @757EE3DK 36

B7D57@F397A8E3>7E?7F:A6

GBGLM:M>F>GM:IIKH:LMBF:MBG@NG:QI>GL>;RFNEMBIERBG@L:E>LHKCNLM=BML:E>L;RMA>I>KGM:@>MA:M:K>GHM>QI>=MH;>=

B7D57@F397A8D757;H34>7E?7F:A6

;:E:GLA>>M:IIKH:LMBF:MBG@NG:KGM:@>MA:M:K>GHM>QI>=MH;>=

39;@9?7F:A6

O:KB:MBHGH?MA>I>KGM:@>H?K>BO:;E>LF>MAH=PA>K>:EEK>BO:;E>L:K>`KLM=;R:@>MA>MHM:EH?>:GFNEMBIEB>=;R:G:IIKHIKB:M>I>KGM:@>:G=LNFF>=MH=>M>KFBG>MA>:EEHP:G;:E:GMH;>K>IHKM>=

/# /0' ./$(/$*)*!0)*'' /$' *0)/.

" ( $ $ % * , )


EF;?3F73@6D75AD6436674FEI:7@F:7B7D57@F397A8E3>7E?7F:A6;E3BB>;76

EF;?3F73@6D75AD6436674FEI:7@F:7B7D57@F397A8D757;H34>7E?7F:A6;E3BB>;76 JB>3;@F:7D73EA@F:3F436674F7JB7@E73@6F:73>>AI3@578AD6AG4F8G>355AG@FE@AD?3>>K

D7BADF6;Q7D7@FR9GD7E +@67DEF3@6F:7D73EA@8AD?3;@F3;@;@93EG4E;6;3DK>7697D

/OG(=L@GGJ KLAE9LAF?0F;GDD=;LA:D=;;GMFLK

(G7EF;A@ +:7 V@3> EF7B ;@ D7BADF;@9 D757;H34>7E 8AD 073D +IA ;E F:7 7EF;?3F;A@ A8 F:7 436 355AG@FE ;@5GDD76 6GD;@9 F:;E B7D;A6 +:;E 53>5G>3F;A@ 7@34>7E F:7 BD7B3D3F;A@ A8 F:7 K73D7@6 367697D 43>3@57E ;@ ;9GD7 E3>7E A@ 5D76;F 8AD F:7 K73D I7D7 D7?3;@;@9 355AG@FE D757;H34>7 3?AG@F FA 3@6 3 674;F E;FE ;@ F:7 3>>AI3@57 8AD 6AG4F8G> 355AG@FE %AD75AD6;@9 :3E K7F 477@ ?367 8AD F:7 073D +IA 436 674F 7JB7@E7 8@ -8.< =1. *,,8>7=*7= *;;2?. *= =1..7,855.,=2+5.*,,8>7= _F9F;A9D 9;;GMFLAF? AK IMAL= KL9F

+( 6>75F;4>755AG@FEEF;?3F763E3&7D57@F397A8)3>7E

/@= 97E#7F:A6

>L=J L@AK 9GJ 4=9J /OG 9J= K@GOF AF!A?MJ=

+( +@5A>>75F;4>755AG@FEEF;?3F763E76A@&7D57@FA8)3>7E

&*($$$"(&%(*$-*$%(#*%$)%$,/%+*(,")


* ) * / % + ( ) "

'G7EF;A@

0A> 0K:O>KL HKIHK:MBHG LM:KML HI>K:MBHGL BG 5>:K +G> :G= F:D>L =BM L:E>L H? I>K R>:K PABE> :K NKBG@ >::K BG := MH ;> NG0A> LMBF:M>L MA:M I>KGM H? BML =BM L:E>L PBEE >O>GMN:EER IKHO> MH ;> PHKMAE>LL 3A:M BL K>IHKM>=:LMA>:EEHP:G?HK=HN;M?NE:M:MMA>>G=H?5>:K0PH

: ; < =

@EI7D

0A>KBL3@3F;A@

M MA> >G= H? 5>:K +G> MA> :EEHP:G : : >LMBF:M>= ;:= =>;M >QI>GL> U I>KGM ?HK : K>IHKM>= MHM:E H? NKBG@5>:K 0PH :GHMA>K =>;BM BL K>= ;> H? MA> := MH K> MA> GM R>:KZL >QI>GL> 0A> :EEHP:G ;:E:G BL GHP ^

/@=A>>=J=F;==LO==F9MD;;GMFLK

(G7EF;A@ ;9GD7 BD7E7@FE F:7 V@3@5;3> EF3F7?7@F V9GD7E 8AD F:;E 5A?B3@K 8AD 073D +IA 8@ ,*7+*- -.+= .A9.75*,,8>7=< 87 =1. +*5*7,. ;@ 7H7DKE7FA8V@3@5;3>EF3F7?7@FE

FKO=J /@= 9ADMJ= G> HJ=NAGMK =KLAE9LAGFK LG :=9;;MJ9L= $F 4=9J *F= :9< GJ L@AK ;GEH9FQ O9K J=HGJL=< 9K

:ML 9;;GMFLK OAL@:9D9F;=K LGL9DAF?

9;LM9DDQ HJGN=< LG := MF;GDD=;LA:D= AF 4=9J /OG /@9L ;9MK=< 9F 9 L@= L@=

4=9J *F= MF L@= LOG J=HGJL=7E F:7 53>5G>3F;A@ A8 436 674FE 3 4;F 6;U7D7@F>K EEG?7 F:3F F:7 073D +IA 36>AI3@57 8AD 6AG4F8G> 355AG@FE EF;>> :A>6E 3 674;F 43>3@57 3E E:AI@ ;@ ;9GD7 >EA 3EEG?7 F:3F F:7 5A?B3@K :3E @AI 5:AE7@ FA GE7 F:7 B7D57@F397 A8 D757;H34>7E ?7F:A6 D3F:7D F:3@ F:7 B7D57@F397 A8 E3>7E ?7F:A6 &X5;3>E :3H7 >AA=76 3F 3>> 3H3;>34>7 7H;67@57 3@6 5A?7 FA F:7 5A@5>GE;A@ F:3F B7D57@F A8 7@6;@9 355AG@FE D757;H34>7 M B7D57@F AD 3D7 >;=7>K FA BDAH7 G@5A>>75F;4>[email protected]*,,8>7= J=;=AN9:D=K E=L@G< GJ L@= 9?AF? E=L@G< A> L@9L N9JA9LAGF AK MK=

9K L@= HJGH=J LGL9D >GJ L@= 9DDGO9F;= >GJ MD 9;;GMFLK /@MK L@=9;;GMFL9FL EMKL LMJF L@=

+( 6>75F;4>755AG@FEEF;?3F763E3&7D57@F397A8(757;H34>7E

K K@GOF AF !A?MJ= L@AK =FLJQ KM;;=KK>MDDQ ;@9F?=K L@= 9DDGO9F;= >JGE 9

755AG@FEEF;?3F763E76A@&7D57@FA8(757;H34>7E

*F;= 9?9AF L@= J=HGJL=< =PH=FK=

AK

@A?@=J L@9F L@= 9DDGO9F;=

K :=>GJ=L@= L@= =KLAE9LAGF :=AF? LGG DGO AF L@= HJAGJ Q=9J /@= 9

EG4E;6;3DK>7697D

@KHNIH?BG=BOB=N:E:>LPBMA:G=MA>K>?HK>>QIE:BGL:@>G>K:EE>=@>K:JGE Q=9J LG Q=9J *F;= 9 E=L@G< AK K=

D=;L=GJ= ;GEHML=J KQKL=EK :=;9E= ;GEEGF E9FM9DDQ C==HAF? L@= LGL9D G> L@GMK9F AF

?A@7F3DK3EE7FE3@6?A@7F3DK>;34;>;F;7E

FHNGMLMA:M:K>A>E=;R:GHK@:GBS:MBHG:L>BMA>KK>BIMLHKI:RF>GMLH?:LI>=:FHNGMH??NMNK>

9;;GMFLAF? 9DO9QK HGK=K 9 GJ AFN=KLGJK 9F< ;J= GHLAGF9D 9HHJG9;@=K O=J= 9DDGO=< AF ;GFF=;LAGF OAL@ >GJ=A?F ;MJJ=F;A=K /@=J=>GJ=0."+@9KDGF?@9 GF= =MJG AF L=JEK G> 0. GJ J=HGJLAF? HMJHGK=K #GO=N=J ;MJJ=F;Q =P;@9F?= J9L=K 9J= J9J=DQ _P=L=F ;@9F?= EGE=FL :Q EGE=FL !GJ =P9EHD= A> 9 K9D= AK E9GJ=A?F ;MJJ=F;Q AF L@9L :9D9F;= AFL=JEK G> 0. L@=K=>GJ=A?F;MJJ=F;Q9EGMFLKHGK=K9;@9DD=F?=OAL@FG=9KQJ=KGDMLAGF

;;GMFLAF?>GJ@9F?=KAFMJJ=F;Q P;@9F?=-9L=K

(G7EF;A@ J5:3@97 D3F7E F:3F H3DK AH7D F;?7 5D73F7 3 D7BADF;@9 BDA4>7? 8AD 5A?B3@;7E AB7D3F;@9 ;@ ;@F7D@3F;A@3> ?3D=7FE +A ;>>GEFD3F7 3EEG?7 3 ,* 5A?B3@K ?3=7E 3 E3>7 A8 3 E7DH;57 FA 3 $7J;53@ 5A?B3@K A@ 757?47D 073D &@7 8AD $7J;53@ B7EAE F:3F I;>> 47 B3;6 3F 3 >3F7D 63F7 EEG?7 3>EAF:3F F:7 7J5:3@97 D3F7 A@ F:7 63K I:7@ F:7 E3>7 I3E ?367 I3E B7EA 7CG3> FA AI7H7D 4K F:7 7@6A8 073D &@7 I:7@ V@3@5;3> EF3F7?7@FE 3D7 BDA6G576 F:7 7J5:3@97 D3F7 ;E 6;U7D7@F B7EA ;E @AI IADF: '1*= ;.98;=270 -8.< * %# ,869*7B 6*4. 8/ =;*7;;.7,B2/=1..A,1*70.;*=.,1*70. L@= 0. GJ

S /@=J= 9J= FME=JGMK J=9KGFK O@Q L@= J=D9LAN= N9DM= G>L@=K= LOG ;MJJ=F;A=K EA?@L @9N= ;@9F?=< :ML L@= ;9MK= AK FGL AEHGJL9FL >JGE 9F 9;;GMFLAF?H=JKH=;LAN=

2@=F 9 4=9J *F= GF= GJ :GL@ G> L@= 9;;GMFL :9D9F;=K 9;;GMFLK J=;=AN9:D= 9F< K9D=K G> K=JNA;=K;GMD< J=E9AF 9L

GJ := MHGJ= L@= EGF=Q AK ;GDD=;L=< L@= H=KG @9K JAK=F AF N9DM= LG ;;GMFLAF? F==GJ J=HGJLAF?KM;@ >GJ=A?F ;MJJ=F;Q :9D9F;=K GEEMFA;9LAGF AK KLJM;LMJ= +DMK L@=KL9FGDDGO GL@ L@= AFMLMJ= ;9K@9EGMFLK L@= ;MJJ=FL =P;@9F?= J9L= AK NA=O=< 9K EGKL J=D=N9FL $F L@AK ADDMKLJ9LAGF L@= N9DM= G> L@= J=

;=AN9:D= 9 EGF=L9JQ 9KK=L @9K ;@9F?=< AF L=JEK G> 0. =9;@ J9L@=J L@9F /@= J=HGJL=< J=;=AN9:D= AK MH

H=KGKS

$$"%+$*$,()%$


9K@ J=;=AN9:D=K 9F< H9Q9:D=K GJ=A?F ;MJJ=F;Q EMKL := 9GJ J=HGJLAF?HMJHGK=K O@=F=N=J =P;@9F?= J9L=K `M;LM9L= DD GL@=J 9;;GMFL :9D9F;=K =IMAHE=FL K9D=K J=FL =P

H=FK= MJL@=J ;@9F?=K 9J= =N=J F==>=;LG>9@9F?=AFMJJ=F;Q P;@9F?=-9L=K

(G7EF;A@ :3@97E ;@ 7J5:3@97 D3F7E 3U75F F:7 D7BADF;@9 A8 ?A@7F3DK 3EE7FE 3@6 >;34;>;F;7E +:AE73?AG@FE 3D7 >;F7D3>>K IADF: ?AD7 AD >7EE ,* 6A>>3DE 3E F:7 D7>3F;H7 H3>G7 A8 F:7 5GDD7@5K WG5FG3F7E AH7DF;?7 AD F:7 FIA 43>3@57E 34AH7 F:7 355AG@F D757;H34>7 :3E FA 47 D7?73EGD76 A@ F:7 63F7 A8 F:7 43>3@57E:77F 4753GE7 ;F ;E 3 ?A@7F3DK 3EE7F I:7D73E F:7 E3>7E 43>3@57 D7?3;@E D7BADF76 3E B7D?3@7@F>KAI ;E F:;E 5:3@97 ;@ F:7 D757;H34>7 355A?B>;E:76 '1.7 687.=*;B *;98GJ EGF=L9JQ 9KK=LK 9F< DA9:ADALA=K AF;J=9K=K GJ ;@9F?=KAF ;MJJ=F;Q =P;@9F?= J9L=K 9 ?9AF GJ DGKK AK J=;G?FAR=< GF L@= AF;GE= KL9L=E=FL #=J= L@= J=HGJL=< J=

;=AN9:D= AK FGO

@A?@=J /@= ;GEH9FQXK _F9F;A9D ;GF EGF=L9JQ 9KK=LK EGF=L

9JQ DA9:ADALA=K AF;J=9K=K 9 DGKK AK J=;G?FAR=

O@AD= ALK AF;GE= KL9L=E=FL >GJ L@9L Q=9J K@GOK K9D=K J=N=FM= G>

9K O=DD 9K L@= 9:GN= ?9AF G>

DL@GM?@ L@= LJ9FK9;LAGF O9K 9;LM9DDQ >GJ

(=PA;9F H=KGK L@= ;GEH9FQ J=;GJALK>MF;LAGF9D;MJJ=F;QL@=0.

* ) * / % + ( ) "

'G7EF;A@

0A> $:F>KLM>BG HFI:GR BL KBG@ HI>GBG@ : K>M:BE LMHK> BG 'RHMH &:I:G %G IKBE H? 5>:K +G> MA> >G=H?MABLL>GMLLAHNE=;>:;E>MHF>>MMA>?HEEHPBG@H;C>L

A?BGF7F:75GDD7@FD3F;AF:73?AG@FA8IAD=;@953B;F3>3@6AF:7DR9GD7EB7DF;@7@FFAF:7D7BADF;@9A8355AG@FED757;H34>7

7E5D;47F:7;?B>;53F;A@EA835A?B3@KNE5GDD7@FD3F;A 7E5D;47F:7;?B>;53F;A@EA835A?B3@KNEIAD=;@953B;F3>43>3@57 3>5G>3F7F:73?AG@FA8F;?7F:3FB3EE7E478AD7F:73H7D397355AG@FED757;H34>7;E5A>>75F76

3@67JB>3;@F:7;?BADF3@57A8F:;E;@8AD?3F;A@ ";EFF75:@;CG7EF:3F34GE;@7EE53@;?B>7?7@FFAEB776GB5A>>75F;A@A8;FE355AG@FED757;H34>7

MJJ=FL-9LAG9FE 3@3>KL7 V@3@5;3> EF3F7?7@FE FA ?3=7 >A9;53> 3@6 3BBDABD;3F7 675;E;A@E 34AGF 35A?B3@KQE V@3@5;3> :73>F: 3@6 I7>> 47;@9 +:;E BDA57EE ;E EA?7I:3F E;?;>3D FA 3 ?76;53> 6A5FAD B7D8AD?;@9 3 B:KE;53> 7J3?;@3F;A@ A@ 3 B3F;7@F +:7 6A5FAD A8F7@ 479;@E 4K 5:75=;@9 H3D;AGE H;F3> E;9@E EG5: 3E

$$"%+$*$,()%$


5GDD7@FD3F;A

"HKFNE:F>:LNKBG@:GHK@:GBS:MBHGZLEBJNB=BMRMA>:;BEBMRMHI:R=>;ML:LMA>R=N>ML;RGMEB:;BEBMB>L

IAD=;@953B;F3>

"HKFNE:F>:LNKBG@:GHK@:GBS:MBHGZLEBJNB=BMRMA>:;BEBMRMHI:R=>;ML:LMA>R=N>ML

:73DF D3F7 4>AA6 BD7EEGD7 I7;9:F 5:A>7EF7DA> >7H7> 3@6 4A6K F7?B7D3FGD7 >AA=;@9 8AD 3@K E;9@E A8 3 E7D;AGE 5:3@97 AD BDA4>7? AD 7J3?B>7 ;8 3 B7DEA@QE :73DF D3F7 ;E :;9:7D F:3@ 7JB75F76 AD ;8 4>AA6 BD7EEGD7:3E ;@5D73E76 E;9@;V53@F>K E;@57 F:7 >3EF H;E;F F:7 6A5FAD I;>> ;@H7EF;93F7 I;F: EB75;3> 53D7 7 *7*5BC270=1. I7*7,2*5 3BGLHEB> HKIHK:MBHG K>IHKML MA> ?HEEHPBG@ :LL>M ;:E:GL MX BGO>GMHKRX :G= E:G=X 0A> ?HEEHPBG@ EB:;BEBMB>L L:E:KB>LI:R:;E>X : I:R:;E> =N> BG L>O>G FHGMALX :G= GHM> I:R:;E>=N>BG`O>R>:KLX3A:MBLMA>KBLGM :LL>ML :K> NLN:EER MAHL> MA:M PBEE ;> NL>= HK = PBMABG HG> R>:K "HK MABL GM EB:;BEBMB>L :K> =>;ML MA:M PBEE ;> I:B= PBMABGHG> R>:K L:E:KB>L I:R:;E> H? : I:R:;E> =N> BG L>O>G FHGMAL H? 0A> GM EB:;BEBMR MHM:E ?HK MABL GM K:MBH BL =BOB=>= ;RHKMH

GEHMLAF?L@=?=G>;;GMFLK-=;=AN9:D=

(G7EF;A@ +:;E 5:3BF7D 673>E I;F: F:7 V@3@5;3> D7BADF;@9 A8 355AG@FE D757;H34>7 '1*= 8=1.; ?2=*5

D757;H34>7EFGD@AH7D

"HKFNE:F>:LNKBG@LI>>=H?:GHK@:GBS:MBHGZL:O>K:@>:;:E:G?HKMA>I>KBH=

/@MK AFL=J=KL=< H9JLA=K :GL@ AFKAJ=IM=FLDQ EGFALGJ L@= LAE=L9C=F LG ;GDD=;L J=;=AN9:D=K ,MA;C ;GDD=;LAGF AK FGJE9DDQ NA=O=< 9K HGKKA:D= HJG:D=EK #GO=N=J 9K OAL@ EGKL ?=F=J9DAR9LAGFK =P;=HLAGFK MJL@=JAFN=KLA?9LAGFAK9DO9QK9GJ= /@= GJEMD9

8+)+/

3H7D397397A8355AG@FED757;H34>7

"HKFNE:F>:LNKBG@MA>:O>K:@>E>G@MAH?MBF>BMM:D>LMHK::M:IHBGMBGMBF>HKMA>:O>K:@>:?HKMA>I>KBH=;RMA>:O>K:@>L:E>LF:=>I>K=:R

-=-:)/- )/- 7. )++7=6)*4- 8AD F:7;D5A?B3@K ;E 97FF;@9 A>67D I:3F FKB7 A8 D7?76;3> 35F;A@E 53@ 47 F3=7@ 8@ -8.< * ,869*7B ;.->,. =1.*?.;*0.7>6+.;8/-*B2;.-=8,855.,=;.,.2?*+5. K9D=K GJ ;J=9L= =PH=FK=K L@9LEA?@L GMLO=A?@ L@= :=F=_LK G> IMA;C=J ;9K@ AF`GOK (9F9?=E=FL K@GMD< E9C= KM;@ ;J=GJ=K=DDAF?LG9;MKLGE=JGF;J=K9D=KGF9;;GMFL9J=GFDQE9BO:;E>L MNKGHO>K :K> F>:LNK>L H? MA> LI>>= H? G>>=>= MH H;M:BG I:RF>GML ?KHF KL LAHNE= ;> ?NEER K>= PA>G LMN=RBG@ : F>GM G MA> GNF;>K H? =:RL BM M:D>L MH K>BO> KBG@ =BM ;BEEBG@ :G= KBG@=BLKBGGMBO>L?HKJNBGM

*3>=;@9I;F:3(73>@H7EF;@9&DAA@F;@G76

"HEEHPBG@BL:KOB>PPBMA'>OBG#NKGL

Question (>MZL L:R MA:M RHN :K> :G:ERSBG@ : I:KMBL>GMER EHHDBG@ :M BML GM :LL>ML3A>G RHN :K> LMN=RBG@ : L H? BG?HKF:MBHG M>G= MH > :K>:L LI>

,;67A>;B

,KH?>LLHK&H>$HRE>M:EDL:;HNMMA>`O>FHLMBFIHKM:GMIHBGMLBG A:IM>K

2B>PMA>OB=>HHGEBG>:MAMMI;BMERAHRE>

$$"%+$*$,()%$


)*!#+/ - 3 -$. .

' + ) * % $ )

IHKML:;:E:GH?FBEEBHG?HKBML[:\3A:MBLF>:GM;R:$HP:K>:K>IHKM>=BG:L>MH?`G:GF>GML

$HPBLMA>G>MK>:EBS:;E>O:EN>H?:M>KFBG>= 0A>/REO>LM>KHKIHK:MBHGA:L:MA:MMHM:EFBEEBHG$HP>O>KMA>LGHM

>QI>KFBG>MA>:FHNGMH?MA>L>:MA:MPBEENEMBF:M>ER;>=

3A:M=H>LMA>:INKIHL>H?:[;>K>IHKM>= 3AR=HLL>MNI:G:EEHP:G?HK=HN;M?NE::LBG@:?HKMA>>QI>=:FHNGMH?NG;:E:GL 0A>;K:ABFHKIHK:MBHG=BLK>=MA:MHG>H?BMLKLP>GMBGMH;:GDKNIM:;E>

MHI:RMA>;:E:GMA:MBMHP>L3A:M>GMKR=H>L:;K:ABFF:D>MHPKBM>H_:LI>NG

LH_:K>BO:;E>:LNG$HP=H>LMA:M>GMKRMA>:FHNGMK>IHKM>=;RMA>MK>BO:;E>;:E:G

LH_:K>BO:;E>:LNG$HP=H>LMA:M>GMKRBFI:K>IHKM>=G>MBGH?MABL

%G5>:K+G>&HK=:GHFI:GRPKBM>LH_GBG>:H?MA>L>:=>;MHKBO>=`G:GG@MA3A:M>GMKR=H>L&HK=:GF:D>PA>GMABLBO>=

%G5>:K+G>MA>:LM:@G:HFI:GRK>IHKM>=;:==>;M>QI>GL>H?$HP>O>KBG5>:K0PHMA>>:D:G=MA>K>IHKM>=BGMA>5>:K+G>`G:GF>GML3AR=B=:LM:@G:GHMMA>;:E:GK>IHKM>=?HK5>:K+G>GHPMA:MMA>:KBLDGHPG

0A>*:@:GHHKIHK:MBHGBLIK>I:KBG@`G:GF>GML?HKMA>E:M>LMR>:K0A>EELHG=BM:G=MANLFNLM:GMBMA>:FHNGMH?BML;:=:FHLMMAH=L?HKF:DBG@MABL>LMBF:MBHG

MMA>>G=H?5>:K0PH;>?HK>F:DBG@:=CNLMBG@>GMKB>L:G=IK>I:KBG@`G:GF>GML:$>:MA>KHFI:GRK>IHKM>=;:==>;M>QI>GL>H?:G=:G:EEHP:G?HK=HN;M?NE:L>`@NK>LGHMB=>GMBINKIHL>H?:=@>K 3AR=H>LMA>K>IHKMBG@H?;:E:GL=>GHFBG:M>=BG:?HK>B@GGG@>L?HKMA>

:FHG>M:KR:LL>ML:G=FHG>M:KREB:;BEBMB>L 0A>(>GHBKHKIHK:MBHGA:L0:K:EE>=@>K)HLMH?MA>L>;:E:GL:K>=>GHFBG:M>=BG

1/=HEE:KLBML?NG;:E:GL:K>=HFBG:M>=BG:?HK>B@GG?HK>B@GGK>F>:LNK>=:MABLMHKBQK:M>L:G=PABK>F>:LNK>=:MMA>GM>QK:M>?HKK>IHKMBG@INKIHL>L

$HPBLMA>GMK:MBH:FHNGMH?PHKDBG@M>KFBG>=3A:M=HMA>L>MPH=:FHNGMLBG=B:;HNM:KL=>M>KFBG>MA>:O>K:@>:@>H?:K>IHKMBG@>GMBMRZL: $HP=H=>KL=>M>KFBG>MA>K>BO:;E>LMNKGHO>K;:L>=HGMA>BG?HKF:MBHGK>IHKM>=;R:

,B>KHFI:GRL>EELBMLF>KHG=BMMMA>>G=H?5>:K+G>K:@>H?=:RLMHI:R?HKMA>BK@HH=L$HP>O>KK>GMERMA:MI>KBH=A:LCNFI>=MH=:RLPAB

* ( + % ( " )

9999HFI:GB>LNL>MPHL>I:K:M>0:IHKM::MBMLG>MK>:EBS:;E>O:EN>

9999:==>;M>QI>GL>BLK>IHKM>=HGMA>;:E:GLA>>M:L:QI>GL>LAHNE=;>K>IHKM>=BGMA>L:F>I>KBH=:LK>E:M>=K>O>GN>K>@:K=E>LLH?PA>GMA>K>BO:;E>BL=>M>KFBG>=MH;>NG

9999>GBG;NLBG>LL?HKL>O>K:ER>:KL%GMA>GMR>:KIKBHKMHIK>I:KBG@:=CNLMBG@>GMKB>LLHMA:M`G:GF>GMLIK>I:K>=MA>;:=>QI>GL>0:KH;:E:G

9999>GBG;NLBG>LL?HKL>O>K:ER>:KLMMA>>G=H?MA>GMR>:KIKBHKMH:GR:=CNLMBG@>GMKB>L;>BG@IK>I:K>=MA>:EEHP:G?HK=HN;M?NE:OBHNLR>:K>LMBF:MBHGH?NG:K?HKFMA>BK>LMBF:MBHGH?NG:F:GG>K

9999+G:L>MH?`G:GF>GMLMA>:FHNGMH?;:==>;M>QI>GL>:G=MA>>G=BG@;:E:GBGMA>:EEHP:G?HK=HN;M?NE:GMER=B_>K

9999G=LMA>GMR>:KPBMAL:E>LH?:H?:G=:G:EEHP:G?HK=HN;M?NE:;ML:K>>LMBF:M>=MH;>I>KGMH?L:E>L+G`G:GF>GMLMA>:EEHP:G?HK=HN;M?NE:IHKM>=:LA:OBG@:G=BM;:E:G

9999G=LMA>GMR>:KPBMAL:E>LH?:H?:G=:G:EEHP:G?HK=HN;M?NE:>LMBF:M>=MH;>I>KGMH?L:E>L+G`G:GF>GML;:==>;M>QI>GL>PBEE;>K>IHKM>=:LA:OBG@:G=>;BM;:E:G

9999G=LMA>GMR>:KPBMAL:E>LH?:H?:G=:G:EEHP:G?HK=HN;M?NE:R>:K:K>>LMBF:M>=MH;>I>KGMH?K>BO:;E>L:==>;M>QI>GL>PBEE;>K>IHKM>=HGMA>BGLM:M>F>GM:L

9999G=LMA>GMR>:KPBMAL:E>LH?:H?:G=:G:EEHP:G?HK=HN;M?NE::K:K>>LMBF:M>=MH;>I>KGMH?K>BO:;E>L:==>;M>QI>GL>PBEE;>K>IHKM>=HGMA>BGLM:M>F>GM:L

9999G=L5>:K0PHPBMA;:==>;M>QI>GL>H?:G=:G:EEHP:G?HK=HN;M?NE:>:K>BO:;E>BLPKBMM>GH_:LNG*>MBGBLK>=N=;RHGMA:M=:M>

9999G=L5>:K0PHPBMA;:==>;M>QI>GL>H?:G=:G:EEHP:G?HK=HN;M?NE:>:K>BO:;E>BLPKBMM>GH_:LNG0A>G>M:FHNGMK>IHKM>=?HK:BLK>=N=;RHGMA:M=:M>

99991/1/=HEE:K:LBML?NGBG:?HK>B@G>LMHK>BO>OBEL>EHKHGMA>;:E:GLA>>M=:M>0A>IHKM:EHLLHGBMLBGLM:M>F>GMH?:L:K>LNEMH?MA>BGMA>>QK:M>

99991/1/=HEE:K:LBML?NGBG:?HK>B@G>LMHK>BO>OBEL>EHKHGMA>;:E:GLA>>M=:M>+GBMLBGLM:M>F>GMMA>IHKM:L:E>H?

9999LL:E>LH?BG5>:K0AK>>MMA>>G=H?5>:K0AK>>MA>K>BO:;E>;:E:GBL0A>:O>K:@>K:MMA:MMBF>BLM:DBG@=:RLMHF:D>I:RF>GMMHMA>LH?HGMA>`KLM=:RH?MA>R>:K NKBG@MA>R>:KMA>LL:E>LH?;NMHGERK>>QI>=HKNGK>==NKBG@MA>R>:K0A>K>BO:;E>LMNKGHO>K?HKMA>I>KBH=P:L

$$"%+$*$,()%$


# + " * & " %

3AB?HEEHPBG@PHNE= @AF ;>NL>=MHA>EI:M>KFBG>MA>G>MK>:EBS:;E>O:EN>H?BML:

: %G=NLMKR:O>K:@>L:G=MK>G=L; 0A>;ML< NKK>GM>GL>

: ):M`M:G:ERLBL= )>:LNK>F>GMIKBG

/NG"NGHFI:GRF:GN?:LE:PG?NKGBMNK>MA:MBLLHE=MHK>M:BELMHK>L NKBG@+K5>:K+G>/NG"NGLHE=?NKGBMNK>MH$HF>,E:HG:>G=H?5>:K+G>MA>;:E:GP:LLMBEEHNMLM:G=BG@%G):K:K0PH/NG"NG=>=MHPKBM>H_MABLI:KMBO>K;>=AHHL>MA>GMKR?HKMABLPKBM>H_

: +(

; +(

< +(

= +(

&*($$$"(&%(*$-*$%(#*%$)%$,/%+*(,")


I:KBG@MHIKH=N:L>MH?`G:GF>GML0A>;:E:GLA>>M;>BG@:M>=LAHPL:MHM:E?HK:LL>MLH?:G=:MHM:E?HKEB:;BEBMB>LH?&NLMIKBHKMHMA>>G=H?MA>R>:KHG>:BL=>M>KFBG>=MH;>NG:G=BLPKBMM>GH_GHMA>KK>BO:;E>?HKBL=*HHMA>K>O>GMHK:=CNLMF>GMBLF:=>3A:MLAHNE=MA>IHKM:LMA>MHM:EH?BML:LL>ML:?M>KK>L>`G:EMPH>O>GML

: ; < =

#E:=LHGHKIHK:MBHGK>IHKML;:==>;M>QI>GL>NLBG@MA>I>KGM:@>H?L:E>LF>MAH=MMA>>G=H?MA>R>:K#E:=LHGA:LBG::G=:=BMBGBML:EEHP:G?HK=HN;M?NE::GR>GMKRBLF:=>?HK;:==>;ML/:E>L?HKMA>R>:KP>K>FBEEBHG0A>I>KGM:@>MA:M#E:=LHGA:LABLMHKB=MH;MLBLI>KGMH?L:E>L3AB?HEEHPBG@BLMKN>

: #E:=LHGZL;:==>;M>QI>GL>?HKMA>R>:KBL; #E:=LHGZL;:==>;M>QI>GL>?HKMA>R>:KBL< #E:=LHGPHNE=K>IHKM:G:EEHP:G?HK=HN;M?NE:.:E>B@AHKIHK:MBHGAHE=L:H?:G=:G:EEHP:G?HK=HN;M?NE::EBS:;E>O:EN>H? NKBG@MA>R>:K=BML:E>LP>K>:G=BO:;E>LP>K>PKBMM>GH_:LNG%?I>KGMH?L:E>LBL>LMBF:M>=:LNG>::KPA:MBLMA>G>M:;:E:GK>IHKM>=:MMA>>G=H?5>:K0PHHG.:E>B@AZL;:E:GLA>>M

: ; < =

+GMA>`KLM=:RH?5>:K0PHMA>.BO:EN>H? NKBG@MA>R>:K=BML:E>LP>K>:G=BO:;E>LP>K>PKBMM>GH_:LNG%?I>KGMH?>G=BG@:BL>LMBF:M>=:LNGPA:M;:==>;M>QI>GL>BLK>IHKM>=?HK5>:K0PHHG.BF>GM

: ; < =

%G5>:K+G>MA>/BFHGHFI:GRPKHM>H_:K>BO:;E>:LNG$HP>O>KHG):R5>:K0PHMA>KK>MNKG>=:G=I:B=/BFHGMA>>GMBK>:FHNGM3AB?HEEHPBG@BLLNEMH?MABLI:RF>GM

: @H>L=HPG;NMMA>:EEHP:G?HK=HN;M?NE::EEHP:G?HK=HN;M?NE:

G=L5>:K0AK>>PBMA:H?:G:EEHP:G?HK=HN;M?NE:;M>QI>GL>H?%G5>:K"HNKL:E>LH?FBEEBHGFHK>:K>F:=>:LA:G=:G:==BMBHG:EBGK>BO:;E>L:K>PKBMM>GH_:LNG0A>LMBF:M>LMA:MI>KGMH?BML>G=BG@:PBEEIKHO>MH;>;:=+G >F;>K5>:K"HNKBO:;E>LMA:MFB@AMP>EE;>NG$HP>O>K:?M>K?NKMA>KK>OB>PMA>L>K>BO:;E>LP>K>GHMPKBMM>GH_:MMABLMBF>RAHPFNH_MA>L>:=G>MBG?HK5>:K"HNK

: .>IHKM>=G>MBGP:LGHM:_>=; 0A>=>K>IHKM>=G>MBGAB@A>K< 0A>=>K>IHKM>=G>MBGAB@A>K= 0A>=>K>IHKM>=G>MBGAB@A>K

$$"%+$*$,()%$


dfu

G=L5>:K0AK>>PBMA:H?:G:EEHP:G?HK=HN;M?NE:;M>QI>GL>H?%G5>:K"HNKL:E>LH?FBEEBHGFHK>:K>F:=>:LA:G=:G:==BMBHG:EBGK>BO:;E>L:K>PKBMM>GH_:LNG0A>LMBF:M>LMA:MI>KGMH?BMLL:E>L>::KPBEE>O>GMN:EERIKHO>MH;>;:=+G >F;>K5>:K"HNKBO:;E>LMA:MFB@AMP>EE;>NG$HP>O>K:?M>K?NKMA>KK>OB>PMA>L>K>BO:;E>LP>K>GHMPKBMM>GH_:MMABLMBF>RAHPFNH_MA>L>:=G>MBG?HK5>:K"HNK

: .>IHKM>=G>MBGP:LGHM:_>=; 0A>=>K>IHKM>=G>MBGAB@A>K< 0A>=>K>IHKM>=G>MBGAB@A>K= 0A>=>K>IHKM>=G>MBGAB@A>K

1/1/=HEE:K:LBML?NG=B:M>ERL>EELBMMH:KBG"K:GHG*HO>F;>K5>:K+G>?HK>NKHL0A>BGO>GMHKRA:=NKHLL>O>K:E=:RL;>?HK>:G:FHNGMPAB>GI:B=HGMA>=:RH?INK0ABLF>KBLLHE=HG:RMH;>I:B=;RMA>KHG&:GN:KR5>:K0PH+G*HO>F;>K5>:K+G>>NKHP:LPHKMAPA>K>:LHG >F;>K5>:K+G>>NKHBLPHKMA3A:MBLMA>BFI:MBGH?MA>BGMA>>QK:M>

: @:BG; EHLL< @:BG= EHLL

+G >F;>K5>:K+G>:EEL:L>KOB?HKLLMA>GK>MA>L:E>P:LF:=>MH;>=BGLBQFHGMAL+GMA:ML:F>=:RMA>GMHKR0ABLBGO>GMHKRP:LLMBEEA>E=:MR>:K>G=+G >F;>K5>:K+G>HG>LBLPHKMAR >F;>K5>:K+G>HG>LBLPHKMA0A>I:KBG@MHIKH=N`G:GF>GML?HK5>:K+G>BGM>KFLH?1/=HEE:KL3AB?HEEHPBG@PBEE;>K>IHKM>=HGBML;:E:GLA>>M

: PBEE;>K>IHKM>=:M:G=BGO>GMHKRPBEE:ELH;>K>IHKM>=:L; PBEE;>K>IHKM>=:M;NMBGO>GMHKRPBEE;>K>IHKM>=:L< PBEE;>K>IHKM>=:M;NMBGO>GMHKRPBEE;>K>IHKM>=:L= PBEE;>K>IHKM>=:M:G=BGO>GMHKRPBEE:ELH;>K>IHKM>=:L

0A>*>P+KE>:GLHFI:GRA:LFHK>GM:LL>MLMA:GGMEB:;BEBMB>L*>:KMA>>G=H?MA>GMR>:KMA>GMI:R:;E>?HK3A:MBLMA>BFI:GMHGMA>LNI< NKK>GMK:MBH@H>L=HPG= 0A>BFI:GMK:MBH=>M>KFBG>=;:L>=HGMA>BG?HKF:MBHGIKHOB=>=

:KE>G>HKIHK:MBHGA:LBG:LL>MLI>KGMH?PABGM:G=BGEB:;BEBMB>LI>KGMH?PABGM3AB?HEEHPBG@BLMKN>

: :KE>G>ZLGMK:MBHBLMH; :KE>G>ZLPHKDBG@G>ZLPHKDBG@GMK:MBH:G=PHKDBG@F>:LNK>LH?:KZL:@>H?>G=BG@K>BO:;E>LP:L?HKMRLBQ=:RL:G=BMLK>BO:;E>LMNKGHO>KP:LLBQMBF>L3AB?HEEHPBG@BL @AF MKN>

: "B?>KZL:@>H?>G=BG@K>BO:;E>LBL=:RL; "B?>KZLK>BO:;E>LMNKGHO>KBLMBF>L< "B?>KZL:@>H?>G=BG@K>BO:;E>LBLE>LLMA:GBMP:LE:LMR>:K= !QM>KG:E=>KLFHGBMHKMA>MBF>BMM:D>L:L

HFI:GRF:=>L:E>LMABLR>:KH?:G=A:L>G=BG@:H?HFI:GR6F:=>L:E>LMABLR>:KH?:G=A:L>G=BG@:H?3AB?HEEHPBG@BLMKN>

: %MM:D>LHFI:GR6:IIKHQBF:M>ER=:RLEHG@>KMHLHFI:GR

&*($$$"(&%(*$-*$%(#*%$)%$,/%+*(,")


; %MM:D>LHFI:GR:IIKHQBF:M>ER=:RLEHG@>KMHLHFI:GR6

< %MM:D>LHFI:GR6:IIKHQBF:M>ER=:RLEHG@>KMHLHFI:GR

= %MM:D>LHFI:GR:IIKHQBF:M>ER=:RLEHG@>KMHLHFI:GR6

, % & ( % " # )

,KH?>LLHK &H> $HRE> =BLL MA> :GLP>KL MH MA>L> MPH IKH;E>FL :M MA> EBGDL MA:M :K> BG=B= ?M>K ?HKFNE:MBG@RHNK:GLP>KLP:M:HMHL>>AHP,KH?>LLHK$HRE>:GLP>KLMA>L>JN>LMBHGL

5HNKKHHFF:M>BL:G!G@EBLAF:CHK0A>KHHFF:M>ZLI:K>GMLHPG:

& ( % " # )

*N:GHFI:GRA:=G>M=BML:E>L?HKMA>R>:KH?*N:G>LMBF:M>LMA:MI>KGMH?BMLG>M=BML:E>LPBEEG>O>K;>=

: ,K>I:K>MA>>GMKRMHK>;M>QI>GL>?HKMA>R>:K; *N:GA:=:H?:MMA>>G=H?MA>R>:K/AHPAHPMA>G>M:;:E:GPHNE=;>K>IHKM>=HGMA>;:E:GLA>>MLLNF>MA:MMA>:EEHP:G?HK=HN;M?NE:>G=H?MA>R>:KH?

< 3ARBLMA>:;:E:GLAHPG:MG>MK:MA>KMA:GCNLMLAHPBG@MA>?NEE:FHNGM

LLNF>MA:M*N:GBGGNF;>KNL>=MA>I>KGM:@>H?K>BO:;E>LF>MAH=MH>LMBF:M>NG:I>KGM:@>H?L:E>LF>MAH=*N:G:LLNF>LMA:MI>KGMH?:PBEEG>O>K;>=

: ,K>I:K>MA>>GMKRMHK>;M>QI>GL>?HKMA>R>:K; /AHPAHPMA>G>M:;:E:GPHNE=;>K>IHKM>=HGMA>;:E:GLA>>M< 3AR:K>L:EEHP>=MH;>MP>>GMA>I>KGM:@>H?L:E>L:G=MA>I>KGM:@>H?

K>BO:;E>LF>MAH=

0A>E?HGLHHKIHK:MBHG;>@BGLHI>K:MBHGLBG5>:K+G>0A>L=BML:E>LH?>::KPABE>:KK>BO:;E>LH?:K>PKBMM>GH_:L;>BG@=HN;M?NEHFI:GRHbLMBF:M>MA:MI>KGMH?:EE=BML:E>LPBEE>O>GMN:EERIKHO>MH;>NG3A:M`@NK>LPBEE;>K>IHKM>=BGMA>:K0PH`G:GF>GMLBGL>=BML:E>L

0A>":EELMHGHKIHK:MBHG;>@BGLHI>K:MBHGLBG5>:K+G>0A>L=BML:E>LH?FBEEBHG>::KPABE>:KK>BO:;E>LH?:K>PKBMM>GH_:L;>BG@=HN;M?NEHFI:GRHbLMBF:M>MA:MI>KGMH?>G=BG@:PBEE>O>GMN:EERIKHO>MH;>NG3A:M`@NK>LPBEE;>K>IHKM>=BGMA>:K0PH`G:GF>GMLBGL>=BML:E>L

.:RZL#:F>,E:L>EEL:EEMA>AHMM>LM@>:K:G=OB=>H@:F>L+G&:GN:KR5>:K0AK>>.:RZLA:=MA>?HEEHPBG@:>.:RZLPKHM>H_BGNG:GMKR; +G>:>GPKBMM>GH_BG::;HO>P:LE:M>K=

=NKBG@MA>R>:K):D>MA>CHNKG:E>GMKB>LMHK>BGLM:M>MA>:.:RZLF:=>=BML:E>LH?:G==H?:.>L>CHNKG:E>GMKB>L= MMA>>G=H?MA>R>:K.:RZL=>M>KFBG>LMA:M:IIKHQBF:M>ERI>KGMH?BML>G=BG@:;:E:GPBEEGHM;>=):D>MA>G>LL:KRCHNKG:E>GMKR

0A>(:PG=:E>HFI:GRLM:KMLMA>GMR>:KPBMAMA>?HEEHPBG@0:?HEEHPBG@>O>GMLM:D>IE:< BGK>BO:;E>L:K>PKBMM>GH_:LNG< K>=BML:E>LH?:K>F:=>< :LAH?BL=?KHFMA>K>BO:;E>L< K>BO:;E>PKBMM>GH_:;HO>BL=:FHNGMBLGHMBG=BGMA>`@NK>

HFI:GRHbEB>O>MA:MI>KGMH?MA>>G=BG@:PBEE>O>GMN:EERIKHO>MH;>NG

: +GBML;:E:GLA>>MPA:MBLK>IHKM>=:LMA>G>M:;:E:G; +GBMLBGLM:M>F>GMPA:MBLK>IHKM>=?HK;:==>;M>QI>GL>

&*($$$"(&%(*$-*$%(#*%$)%$,/%+*(,")


HFI:GR;>@BGL5>:K0PHPBMA:H?:G=:G:EEHP:G?HK=HN;M?NE:Q:;:E:GL NKBG@5>:K0PHHFI:GRF:=>=BML:E>LH?:G=:K$HP>O>KHG>H?MA>L>::K?HKGB>GMA:M`@NK>:;HO>HFI:GR6A:L>Q:L:F>MK:GL:K:MBHGLH?MA>L>MPHL:K>>Q:L:F>+bKGMH?=BML:E>LPBEEIKHO>NGL:K>LNEMH?MABLBG?HKF:MBHG:G=HMA>KMK:GL:IHKM>=G>MBGH?+bEB>O>MA:MI>KGMH?>G=BG@:PBEEIKHO>MH;>NG3A:MG>MBGPBEEHFI:GR6K>IHKM

0A>/IKBG@LHKIHK:MBHGLM:KM>=5>:K"HNKPBMABGBML:0:=MA:MI>KGMH?L:E>LPHNE=>O>GMN:EERIKHO>MH;>NG;:L>=HGI:LMABLMHKR:G=GM>I:K>=:G=IK>EBFBG:KR`G:GF>GMLP>K>:M>=0A>L>LM:M>F>GMLLAHP>=G>MBGH?:G=:MHM:E?HK:EEK>IHKM>=:LL>MLH?MMA>E:LMFHF>GMHG >F;>K5>:K"HNKKK>BO:;E>H?MA:MG>>=>=MH;>PKBMM>GH_;>MA>=>;MHKP>GM;:GDKNIM:G=P:LEBJNB=:M>=3A:MLAHNE=MA>IHKM:LBMLG>MBG?HKMA>R>:K:G=:LBMLMHM:E?HK:EEK>IHKM>=:LL>ML:LH?MA>>G=H?MA:MR>:K

0A>3:EE:HKIHK:MBHGLM:KM>=5>:K"HNKPBMABGBML:0:=MA:MI>KGMH?>G=BG@K>BO:;E>LPHNE=>O>GMN:EERIKHO>MH;>NG;:L>=HGI:LMABLMHKR:G=GM>I:K>=:G=IK>EBFBG:KR`G:GF>GMLP>K>:M>=0A>L>LM:M>F>GMLLAHP>=G>MBGH?:G=:MHM:E?HK:EEK>IHKM>=:LL>MLH?FBEEBHGMMA>E:LMFHF>GMHG >F;>K5>:K"HNKKK>BO:;E>H?MA:MG>>=>=MH;>PKBMM>GH_;>MA>=>;MHKP>GM;:GDKNIM:G=P:LEBJNB=:M>=3A:MLAHNE=MA>IHKM:LBMLG>MBG?HKMA>R>:K:G=:LBMLMHM:E?HK:EEK>IHKM>=:LL>ML:LH?MA>>G=H?MA:MR>:K

+G*HO>F;>K5>:K+G>:1/ML?KHF:GMBLF:=>HG:G:=?KHF:G:

: ?M>KK>L>MPHMK:GL:IHKM:LMA>:FHNGMH?BMLPHKDBG@KK>L>MPHMK:GL:IHKM:LBMLGMK:MBH

+G&:GN:KR5>:K0PH:IHKML:H? NKBG@5>:K0PHMA>LG>P=BML:E>LH?PABE>=MMA>>G=H?5>:K0PHAHPEHG@=H>LMA>:O>K:@>KM:D>MHI:R:G:;:E:G

+G&:GN:KR5>:K0PH:IHKML:H? NKBG@5>:K0PHMA>LG>P=BML:E>LH?PABE>=3A:MBLMA>K>BO:;E>MNKGHO>K?HK5>:K0PH

%G A:IM>K$>:MA>K)BEE>KLM:KM>=A>KHPG;NLBG>LL/>PHHE0A>`G:GF>GML?HK >F;>K:K>LAHPGG>QM

$$"%+$*$,()%$


+(

+(

&*($$$"(&%(*$-*$%(#*%$)%$,/%+*(,")


+(

:L>=HGMA>`G:GF>GML=>M>KFBG>MA>?HEEHPBG@

: NKK>GMK:MBH; 3HKDBG@H?K>BO:;E>L= .>BO:;E>LMNKGHO>KX:LLNFBG@MA:M:HG&:GN:KR4P>K>

$$"%+$*$,()%$


% # & ( $ ) , & ( % " #

0ABL IKH;E>F PBEE K L>O>K:E KL MH >G:;E> LMN=>GML MH ;NBE= MA>BK :@:BG>=BGIK>OBHNLKL

%G A:IM>K (>HG &:= 3>;PHKDL : 3>; LBM> =>LB@G :G= F:BGM>G:G `KF M MA:M MBF> :G :=CNLM>=MKB:E;:E:GP:LIK>I:K>=?HK&NG>

$>K>:K>3>;PHKDL`G:GF>GML:LH?&NG>

+(

+(

+(

&*($$$"(&%(*$-*$%(#*%$)%$,/%+*(,")


0A>?HEEHPBG@>O>GMLHJNBIF>GM?HK;PHKDLINKLLNIIEB>LPHKMAHG:?KHF&NG>= 3>;PHKDLLM:KML:G=M>L?HNKFHK>LBM>L:G=;BEELGML?HK> %G&NG>3>;PHKDLK>BO>=BG:=O:GMH=>LB@G:K>LM:NK:GM3>;LBM>3>;PHKDLM>LMABL

LBM>=NKBG@&NER? 3>;PHKDL;PHKDLI:RL*:GFIEHR>>ABK>=BG&NG>?HKA>KPHKD=NKBG@MA>`KLMMAK>>

P>>DLH?&NERA 3>;PHKDLK>BO>LBG:=O:GMHPHKDHG:3>;LBM>?HK:EHK:G=BG:=O:GMH

PHKDHG:3>;LBM>?HK:EH@BGHGMA>L>3>;LBM>LNGMBEN@NLMB (>HGZLI:K>GML=>MHK>GM:?M>KL>>BG@AHPLN;NLBG>LLBL:G=AHPFNBKAHNL>0A>R:EE:@K>>MA:MK>GMPBEE;>I>KFHGMA3>;PHKDLI:RL?HK&NERN@NLM:G=/>IM>F;>K

C 3>;PHKDLI:RLM:Q>LH?BGI:K>CHNKG:E>GMKB>L?HKMA>IK>OBHNL>O>GML ,HLMMA>CHNKG:E>GMKB>LMH0::GNG:=CNLM>=MKB:E;:E:G?HK3>;PHKDL?HK&NER ,K>I:K>:=CNLMBG@>GMKB>L?HKMA>?HEEHPBG@:G=IHLMMA>FMH0:L*:GKPHKD=NKBG@MA>E:LMP>>DH?&NERE (>HGZLI:K>GMLE>MABFDGHPMA:M3>;PHKDLHP>LMHP:K=MA>>E>FBGN@NLM

F 3>;PHKDL=>M>KFBG>LMA:MBMA:LPHKMAH?LNIIEB>LK>F:BGBG@:MMA>>G=H?&NERG ,K>I:B=K>GMLAHNE=;>:=CNLM>=?HK&NERZLK>GMH (>HGGHP;>EB>O>LMA:MMA>:;E>MHHG=>M>KFBG>MA:MLBFBE:K;NLBG>LL>LK>IHKM:G:EEHP:G?HK;:==>;M:M:G:O>K:@>H?I>KGMH?MA>BK:3>;PHKDLPBEENL>MABLL:F>:IIKH:I:K>:G:=CNLM>=MKB:E;:E:G" ,K>I:K>`G:GF>GML?HK&NER

( ) ( ) ) $ # $ *

LLNF> MA:M RHN M:D> : CH; :L : LNFF>K >FIEHR>> ?HK :G BGO>LMF>GM :=OBLHKR L>KOB +G> H? MA> I:KMG>KL ?HKMA:M `KF BL GMER EHHDBG@ :M MA> IHLLB;BEBMR H? BGO>LMBG@ BG 73K @5 0A> I:KMG>K BL : ;BM = :;HNMMA> BFI: K>LLBHG HG MABL LI> I:KMG>K :LDL RHN MH EHHD :MMA>`G:GF>GML?HK 73K@5 ;R?HEEHPBG@MABLI:MA

< #HMH AMMIPPP>;:R;HMMHFH?MABLL>G?MLB=>H?MA>G>QML>GE>?MLB=>H?MA>G>QML>GGM>KH?MA>G>QML>G:G=`G=MA> >F;>K:G= >F;>K;:E:GLA>>ML< #HMHI:@>:G=`G=MA>BGLM:M>F>GM?HKMA>R>:K>G=>= >F;>K< #HMHI:@>:G=K>:=MA>GHM>:;HNMMA>:EEHP:G?HK=HN;M?NE:L?HNG=HGMA>;:E:GLA>>M:G=MA>BGLM:M>F>GM=>M>KFBG>MA>GNF;>KH?=:RL73K M:D>LMHBO:;E>L:MMA>>G=H?

; 1LBG@MA>`@NK>L?HNG=HGMA>;:E:GLA>>M:G=MA>BGLM:M>F>GM=>M>KFBG>MA>K>BO:;E>LMNKGHO>K?HK 73K =NKBG@

< 1LBG@MA>`@NK>L?HNG=BGMA>;:E:GLA>>M:G=MA>BG?HKF:MBHGBGMA>GHM>L=>M>KFBG>MA>I>KGM:@>H?K>BO:;E>L:LH? >F;>KMA:M:K>>QI>=MH;>NG

$$"%+$*$,()%$


))*/ .

0A> BG=>I>G=>GM :N=BMHKL PBEE :ELH :G:ERS> MA> L:F> :O:BE:;E> >OB=>G :G= FNLM:@K>> MA:M BM BL LNbGM MH L>KO> :L MA> ;:LBL ?HK K>G=>KBG@ K>:LHG:;E> :LLNK:G MA:MMA> `G:GF>GML :K> IK>L>GM>= ?:BKER ;>?HK> :G NGJN:EB`>= HIBGBHG K>E>:L>=

/HF> L BG ;HMA :>M MH BG=B MA> HKB@BGH? MA> K>IHKM>= ;:E:G +MA>KL LAHP HGER MA> LBG@E> G>M `@NK> PBMA >QIE:G:MHKR BG?HKF:MBHGIKHOB=>=BGMA>GHM>LMHMA>`G:GF>GML

> MA> ?H =BLK> BL HG : :G= MA>BK K> IHLLB;E> K>MNKG H? :GRF>KPBEE;>HFBMM>=:MMABLMBF>

):GR L MA>L> MPH >GMKB>L ?HK GB>G 0A> =>;BM MH : BG MA> `KLM >GMKR >Q:ML MA> =BM BG MA> L> L:F> K>;BMBG@ :EEHP:G ?HK

=HN;M?NE :K MA> K:MBHG:E> ?HK MA:M LBG@E> >GMKR BL GHM :EP:RL :L >OB=>GMMH:;>@BGGBG@LMN=>GM

0A> =>;BM `@NK> BL :LLNF>= A>K> ?HK GB>G MH ;> LHE>ER MA> K>LNEM H?NG=>K>LMBF:MBG@ NG : />O>K:E HMA>K ?: IK>L>GM "HK >Q:FIE> MA> ;:E:G BG MA> :EEHP:G ?HK =HN;M?NE :L F:=> BG MA> GM R>:K MA:M :K> =BLK>= MH ;> PHKMAE>LL ;>?HK> MA> >G= H? MA> I>KBH= /N 0A> K>LB=N:E :EEHP:G ;:E:G BL :ELH:_>= ;R MA> G H_ :L PHKMAE>LL BG :G >:KEB>KR>:K L =>L= >:KEB>K MA> :EEHP:G BL := ;R MA:M >O>GM $HP>O>KMA>`G:GIHKMBG@BLGHM:EM>K>=;RMA>:`G:E:EEHP:G`@NK>

L A:L ;>>G LM:M>= IK>OBHNLER MABL BL :G BGMKH=NQM;HHD 0ANL : FHK> BG=>IMA>Q:FBG:MBHG H? F:GR BFIHKM:GM MHIBO>E : K:@> A>K> H? ?HK>B@G GLB@G>= MH BGMKH=N LMN=>GML MH ;:LB< K>IHKMBG@ IKH;E>FL :G= MA>BKK>LHENMBHGL

&*($$$"(&%(*$-*$%(#*%$)%$,/%+*(,")


$$"%+$*$,()%$


Chapter 7: In Financial Reporting, What Information Is Conveyed about Receivables?Accounts Receivable and Net Realizable ValueReporting Accounts ReceivableLack of Exactness in Reporting ReceivablesDetermining Net Realizable Value

Accounting for Uncollectible AccountsThe Allowance for Doubtful AccountsAnticipating Bad Debt ExpenseBad Debts and the Matching PrincipleThe Need for a Separate Allowance Account

The Problem with EstimationsThe Write-Off of an Uncollectible AccountCollecting Accounts Previously Written OffReporting an Incorrect EstimationRecording Receivable Transactions in Subsequent YearsResidual Balance in the Allowance for Doubtful Accounts

The Actual Estimation of Uncollectible AccountsTwo Methods for Estimating Uncollectible AccountsApplying the Percentage of Sales MethodThe Difference Between Bad Debt Expense and the Allowance for Doubtful AccountsApplying the Percentage of Receivables MethodThe Purpose of a Subsidiary Ledger

Reporting Foreign Currency BalancesReporting Balances Denominated in a Foreign CurrencyAccounting for Changes in Currency Exchange RatesThe Income Effect of a Change in Currency Exchange Rates

A Companys Vital SignsAccounts ReceivableCurrent Ratio and Working CapitalComputing the Age of Accounts ReceivableReducing the Time It Takes to Collect Receivables

End-of-Chapter ExercisesEndnotes

Financial Accounting Ch07

Documents

Transcript of Financial Accounting Ch07