CITIGROUP INC 10-K10-K

Business

SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES Throughout these Notes, “Citigroup,” “Citi” and the “Company” refer to Citigroup Inc. and its consolidated subsidiaries. Certain reclassifications and updates have been made to the prior periods’ financial statements and notes to conform to the current period’s presentation. Principles of Consolidation The Consolidated Financial Statements include the accounts of Citigroup and its subsidiaries prepared in accordance with U.S. generally accepted accounting principles (GAAP). The Company consolidates subsidiaries in which it holds, directly or indirectly, more than 50% of the voting rights or where it exercises control. Entities in which the Company holds 20% to 50% of the voting rights and/or has the ability to exercise significant influence, other than investments of designated venture capital subsidiaries or investments accounted for at fair value under the fair value option, are accounted for under the equity method, and the pro rata share of their income (loss) is included in Other revenue . Income from investments in less-than-20%-owned companies is recognized when dividends are received. As discussed in more detail in Note 23, Citigroup also consolidates entities deemed to be variable interest entities when Citigroup is determined to be the primary beneficiary. Gains and losses on the disposition of branches, subsidiaries, affiliates, buildings and other investments are included in Other revenue . Citibank Citibank, N.A. (Citibank) is a commercial bank and indirect wholly owned subsidiary of Citigroup. Citibank’s principal offerings include the following: • investment banking • commercial banking • cash management • trade finance and e-commerce • private banking products and services • consumer finance, credit cards and mortgage lending • retail banking products and services Uses of Special Purpose Entities A special purpose entity (SPE) is an entity designed to fulfill a specific limited need of a sponsoring company. Citi’s principal uses of SPEs include securitizing certain of Citi’s financial assets, assisting clients in their securitizations of financial assets, creating investment products for clients, obtaining liquidity and optimizing capital efficiency through the transfer of financial assets to SPEs that issue beneficial interests. The holders of beneficial interests issued by an SPE usually only have