NOTE 14 - Operating Segments and Geographic Operations
OPERATING SEGMENTS
The company is principally engaged in providing travel related, financial advisory and international banking services throughout the world. TRS’ products and services include, among others, Charge Cards, Cardmember lending products, and corporate and consumer travel services. American Express Financial Advisors’ services and products include financial planning and advice, investment advisory services and a variety of products, including insurance and annuities, investment certificates and mutual funds. American Express Bank/Travelers Cheque (AEB/TC) products and services include Travelers Cheques and providing correspondent, corporate and private banking, personal financial services and global trading. The company operates on a global basis, although the principal market for financial advisory services is the United States.
The following table presents certain information regarding these operating segments at December 31, 1999, 1998 and 1997 and for each of the years then ended. For certain income statement items that are affected by asset securitizations at TRS, data are provided on both a managed basis, which excludes the effect of securitizations, as well as on a GAAP basis. See the TRS Results of Operations section of the Financial Review for further information regarding the effect of securitizations on the financial statements. In addition, net revenues (managed basis) are presented net of provisions for losses and benefits for annuities, insurance and investment certificate products of AEFA.
Income tax provision (benefit) is calculated on a separate return basis; however, benefits from operating losses, loss carrybacks and tax credits (principally foreign tax credits) recognizable for the company’s consolidated reporting purposes are allocated based upon the tax sharing agreement among members of the American Express Company consolidated U.S. tax group.
Assets are those that are used or generated exclusively by each industry segment. The adjustments and eliminations required to determine the consolidated amounts shown above consist principally of the elimination of intersegment amounts.
GEOGRAPHIC OPERATIONS
The following table presents the company’s revenues and pretax income (loss) in different geographic regions.
Most services of the company are provided on an integrated worldwide basis. Therefore, it is not practical to separate precisely the U.S. and international services. Accordingly, the data in the above table are, in part, based upon internal allocations, which necessarily involve management judgments.
