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U.S. and Europe Retrospective Responsibility Plan (Tables)

9 Months Ended

Jun. 30, 2020

Retrospective Responsibility Plan [Abstract]

Changes in the U.S. litigation escrow account

The following table sets forth the changes in the restricted cash equivalents—U.S. litigation escrow account:


	Nine Months Ended June 30,
	2020		2019
	(in millions)
Balance at beginning of period	$	1,205	$	1,491
Return of takedown payment to the litigation escrow account	467		—
Payments to class plaintiffs’ settlement fund⁽¹⁾	—		(600)
Payments to opt-out merchants⁽¹⁾ and interest earned on escrow funds	(524)		11
Balance at end of period	$	1,148	$	902

⁽¹⁾These payments are associated with the Interchange Multidistrict Litigation. See Note 14—Legal Matters.

Changes in Preferred Stock and Right to Recover for Covered Losses

The following table sets forth the activities related to VE territory covered losses in preferred stock and “right to recover for covered losses” within equity during the nine months ended June 30, 2020.



	Preferred Stock						Right to Recover for Covered Losses
	UK&I		Europe
	(in millions)
Balance as of September 30, 2019	$	2,285	$	3,177	$	(171)
VE territory covered losses incurred⁽¹⁾	—		—		(22)
Recovery through conversion rate adjustment⁽²⁾	(72)		(92)		169
Balance as of June 30, 2020	$	2,213	$	3,085	$	(24)

⁽¹⁾VE territory covered losses incurred reflect settlements with merchants and additional legal costs. See Note 14—Legal Matters.

⁽²⁾Adjustment to right to recover for covered losses for the conversion rate adjustment differs from the actual recovered amount due to differences in foreign exchange rates between the time the losses were incurred and the subsequent recovery through the conversion rate adjustment.

Preferred Stock As-Converted Value and Book Value

The following table sets forth the as-converted value of the preferred stock available to recover VE territory covered losses compared to the book value of preferred shares recorded in stockholders’ equity within the Company’s consolidated balance sheets as of June 30, 2020 and September 30, 2019:


	June 30, 2020						September 30, 2019
	As-Converted Value of Preferred Stock^(1),(2)		Book Value of Preferred Stock⁽¹⁾		As-Converted Value of Preferred Stock^(1),(3)		Book Value of Preferred Stock⁽¹⁾
	(in millions)
UK&I preferred stock	$	6,121	$	2,213	$	5,519	$	2,285
Europe preferred stock	8,368		3,085		7,539		3,177
Total	14,489		5,298		13,058		5,462
Less: right to recover for covered losses	(24)		(24)		(171)		(171)
Total recovery for covered losses available	$	14,465	$	5,274	$	12,887	$	5,291

⁽¹⁾Figures in the table may not recalculate exactly due to rounding. As-converted and book values are based on unrounded numbers.

⁽²⁾The as-converted value of preferred stock is calculated as the product of: (a) 2 million and 3 million shares of the UK&I and Europe preferred stock outstanding, respectively, as of June 30, 2020; (b) 12.775 and 13.722, the class A common stock conversion rate applicable to the UK&I and Europe preferred stock as of June 30, 2020, respectively; and (c) $193.17, Visa’s class A common stock closing stock price as of June 30, 2020.

⁽³⁾The as-converted value of preferred stock is calculated as the product of: (a) 2 million and 3 million shares of the UK&I and Europe preferred stock outstanding, respectively, as of September 30, 2019; (b) 12.936 and 13.884, the class A common stock conversion rate applicable to the UK&I and Europe preferred stock as of September 30, 2019, respectively; and (c) $172.01, Visa’s class A common stock closing stock price as of September 30, 2019.