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Note 2 - Variable Interest and Affiliates
9 Months Ended
Jun. 30, 2012
Equity Method Investments and Joint Ventures Disclosure [Text Block]
2.             VARIABLE INTERESTS AND AFFILIATES

Variable Interest Entities

New Jersey Trusts

New Jersey regulation requires that annuitized WAP jackpot payments to winners be administered through an individual trust set up for each WAP system. These trusts are VIEs and IGT is the primary consolidating beneficiary, because these VIE trusts are designed for the sole purpose of administering jackpot payments for IGT WAP winners and IGT guarantees all liabilities of the trusts. The assets of these consolidated VIEs can only be used to settle trust obligations and have been segregated on our balance sheet.

The consolidation of these VIEs primarily increases jackpot liabilities and related assets, as well as interest income and equivalent offsetting interest expense. Consolidated VIE trust assets and equivalent liabilities totaled $62.2 million at June 30, 2012 and $69.7 million at September 30, 2011.

Latin America Distributor

In March 2012, we contracted with a third party distributor in Latin America to sell IGT products. The distributor is a VIE as it is unable to finance its activities without additional support from IGT; however, the distributor was not consolidated because IGT does not have contractual or implied control. Under the agreement, our maximum exposure consists of note financing of $0.8 million provided for operating costs and contract financing under a revolving line of credit of $13.0 million for IGT product purchases. We recorded $3.1 million of noncurrent contracts and notes receivable and $2.3 million in revenues related to this distributor as of and for the third quarter ended June 30, 2012.

Investments in Unconsolidated Affiliates

China LotSynergy Holdings, Ltd.

During our 2011 first quarter, we recognized gain of $4.3 million on the sale of our CLS stock investment for net proceeds of $16.5 million. In May 2012, we received final payment of $9.2 million on our CLS convertible note and all related derivatives were adjusted to zero. See Note 8 and 9 for additional information about related fair value assumptions and derivatives.