Segment Information

3 Months Ended

Mar. 31, 2012

Segment Reporting [Abstract]

Segment Information

Segment Information

A.     Description of segments

Our segment data is based on disclosure requirements of accounting guidance on segment reporting, which requires that financial information be reported on the basis that is used internally for measuring segment performance. Internally, we report information for operating segments based on management responsibility. Our operating segments offer primarily the same types of services within each of the respective segments. The operating segments are as follows:

• North America: We have offices in the United States and Canada that serve local dealers and customers.

• Europe and Caterpillar Power Finance: This segment includes our offices that serve dealers and customers in Europe, Africa, Middle East and the Commonwealth of Independent States.  This segment also includes Caterpillar Power Finance (CPF), which finances marine vessels with Caterpillar engines worldwide and also provides debt financing for Caterpillar electrical power generation, gas compression and co-generation systems, as well as non-Caterpillar equipment that is powered by these systems worldwide. 

• Asia/Pacific: This segment includes offices in Australia, China, Japan, South Korea and Southeast Asia that serve local dealers and customers.  

• Latin America: We have offices in Brazil, Mexico and Chile that serve local dealers and customers in Central and South America.

• Mining: This segment includes large mining customers worldwide. This segment also provides project financing in various countries. 

To align with changes in our executive management responsibilities at Cat Financial, our management reporting structure was updated effective January 1, 2012. Prior year data has been revised to conform to the 2012 presentation.

B.     Measurement and reconciliations

Debt and other expenses are allocated to operating segments based on their respective portfolios. The related Interest expense is calculated based on the amount of allocated debt and the rates associated with that debt. The Provision for credit losses included in each segment's profit is based on each segment's share of the Company's Allowance for credit losses.

Reconciling items are created based on accounting differences between segment reporting and our consolidated external reporting. For the reconciliation of profit before income taxes, we have grouped the reconciling items as follows:

• Unallocated:  This item is related to corporate requirements and strategies that are considered to be for the benefit of the entire organization. Also included are the consolidated results of the special purpose corporation (see Note 7 for additional information) and other miscellaneous items.

• Timing:   Timing differences in the recognition of costs between segment reporting and consolidated external reporting.

• Methodology: Methodology differences between our segment reporting and our external reporting are as follows:

◦ Segment assets include other managed assets for which we typically maintain servicing responsibilities.

◦ Interest expense includes realized forward points on foreign currency forward contracts, with the mark-to-market elements of the forward exchange contracts included as a methodology difference.

◦ The profit attributable to noncontrolling interests is considered a component of segment profit.

As noted above, the segment information is presented on a management-reporting basis. Unlike financial reporting, there is no authoritative guidance for management reporting equivalent to U.S. GAAP.

Supplemental segment data and reconciliations to consolidated external reporting for the three months ended March 31,
(Millions of dollars) 2012	Revenues			Segment Profit			Interest Expense			Depreciation on equipment leased to others		Provision for credit losses			Segment Assets at March 31, 2012			Capital expenditures
North America	$	238		$	74		$	73		$	66	$	(4	)	$	10,808		$	65
Europe and CPF	120			35			34			19		8			7,033			91
Asia/Pacific	92			36			31			5		4			4,732			58
Latin America	95			34			32			14		3			4,122			21
Mining	112			17			23			65		2			2,864			108
Total Segments	657			196			193			169		13			29,559			343
Unallocated	16			(21		)	13			—		1			1,331			—
Timing	(5		)	(3		)	(3		)	—		5			26			—
Methodology	—			(2		)	1			—		—			(15		)	—
Inter-segment Eliminations	—			—			—			—		—			(134		)	—
Total	$	668		$	170		$	204		$	169	$	19		$	30,767		$	343
2011	Revenues			Segment Profit			Interest Expense			Depreciation on equipment leased to others		Provision for credit losses			Segment Assets at December 31, 2011			Capital expenditures
North America	$	247		$	42		$	83		$	70	$	22		$	11,177		$	54
Europe and CPF	124			30			37			23		12			6,601			23
Asia/Pacific	71			22			28			3		8			4,557			6
Latin America	77			20			28			10		9			3,947			40
Mining	108			14			22			64		3			2,645			57
Total Segments	627			128			198			170		54			28,927			180
Unallocated	19			(13		)	9			1		3			1,350			—
Timing	(6		)	1			(2		)	—		(2		)	67			—
Methodology	—			(1		)	(1		)	—		—			15			—
Inter-segment Eliminations	—			—			—			—		—			(247		)	—
Total	$	640		$	115		$	204		$	171	$	55		$	30,112		$	180