Finance Receivables

Finance receivables are receivables of our financial services operations, which generally can be repaid without penalty prior to contractual maturity. Finance receivables generally consist of retail and wholesale accounts and retail and wholesale notes. Total finance receivables reported on the Consolidated Balance Sheets are net of an allowance for doubtful accounts. Total assets of our financial services operations net of intercompany balances are $2.4 billion and $2.6 billion as of January 31, 2013 and October 31, 2012, respectively. Included in total assets are finance receivables of $2.0 billion and $2.1 billion as of January 31, 2013 and October 31, 2012, respectively. We have two portfolio segments of finance receivables based on the type of financing inherent to each portfolio. The retail portfolio segment represents loans or leases to end-users for the purchase or lease of vehicles. The wholesale portfolio segment represents loans to dealers to finance their inventory.

Our finance receivables by major classification are as follows:



(in millions)	January 31, 2013		October 31, 2012
Retail portfolio	$	911	$	1,048
Wholesale portfolio	1,108		1,128
Total finance receivables	2,019		2,176
Less: Allowance for doubtful accounts	25		27
Total finance receivables, net	1,994		2,149
Less: Current portion, net^(A)	1,544		1,663
Noncurrent portion, net	$	450	$	486

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(A)	The current portion of finance receivables is computed based on contractual maturities. Actual cash collections typically vary from the contractual cash flows because of prepayments, extensions, delinquencies, credit losses, and renewals.

Securitizations

Our Financial Services segment transfers wholesale notes, retail accounts receivable, retail notes, finance leases, and operating leases through special purpose entities ("SPEs"), which generally are only permitted to purchase these assets, issue asset-backed securities, and make payments on the securities. In addition to servicing receivables, our continued involvement in the SPEs may include an economic interest in the transferred receivables and, in some cases, managing exposure to interest rates using interest rate swaps and interest rate caps. There were no transfers of finance receivables that qualified for sale accounting treatment as of January 31, 2013 and October 31, 2012, and as a result, the transferred finance receivables are included in our Consolidated Balance Sheets and the related interest earned is included in Finance revenues.

We transfer eligible finance receivables into the retail owner trust or the wholesale note owner trust in order to issue asset-backed securities. These trusts are VIEs of which we are determined to be the primary beneficiary and, therefore, the assets and liabilities of the trusts are included in our Consolidated Balance Sheets. The outstanding balance of finance receivables transferred into these VIEs was $1.0 billion and $1.1 billion as of January 31, 2013 and October 31, 2012, respectively. Other finance receivables pledged to secure borrowings were $119 million and $164 million as of January 31, 2013 and October 31, 2012, respectively. For more information on assets and liabilities of consolidated VIEs and other securitizations accounted for as secured borrowings by our Financial Services segment, see Note 1, Summary of significant accounting policies.

Finance Revenues

Finance revenues consist of the following:



	Three Months Ended January 31,
(in millions)	2013			2012
Retail notes and finance leases revenue	$	21		$	26
Wholesale notes interest	20			23
Operating lease revenue	12			9
Retail and wholesale accounts interest	6			10
Gross finance revenues	59			68
Less: Intercompany revenues	(20		)	(24		)
Finance revenues	$	39		$	44