PRESENTATION

For purposes of this report, “Ford,” the “Company,” “we,” “our,” “us,” or similar references mean Ford Motor Company, our consolidated subsidiaries, and our consolidated VIEs of which we are the primary beneficiary, unless the context requires otherwise. Our financial statements are presented in accordance with U.S. generally accepted accounting principles (“GAAP”).

Effective December 31, 2014, we began reporting the results of our wholly-owned Venezuelan subsidiary using the cost method of accounting. This change resulted in a fourth quarter 2014 one-time pre-tax charge of $800 million in Non-Financial Services interest income and other income/(loss), net.

Change in presentation. Our core Automotive business includes the designing, manufacturing, marketing, and servicing of a full line of Ford cars, trucks, SUVs, and electrified vehicles, as well as Lincoln luxury vehicles. We provide vehicle-related financing and leasing activities through Ford Motor Credit Company LLC (“Ford Credit”). At the same time, we are pursuing emerging opportunities in connectivity, mobility, autonomous vehicles, the customer experience, and data and analytics.

Prior to the second quarter of 2016, we presented our financial statements on both a consolidated basis and on a “sector” basis for our Automotive and Financial Services sectors. With our expansion into mobility services, including the formation in March 2016 of the Ford Smart Mobility LLC subsidiary, we reevaluated our disclosures and concluded we should eliminate our two-sector financial presentation and, reflecting the manner in which our Chief Operating Decision Maker manages our business, changed our segment presentation beginning with the second quarter of 2016 to be Automotive, Financial Services, and All Other. See Note 4 for a description of our segment presentation.

In addition, as a result of the elimination of our two-sector financial presentation, at June 30, 2016 we changed the presentation of our consolidated balance sheet and certain notes to the consolidated financial statements to classify our assets and liabilities as current or non-current. We reclassified certain prior year amounts in our consolidated financial statements to conform to the current year presentation.

Certain Transactions Between Automotive Segment and Financial Services Segment

Intersegment transactions occur in the ordinary course of business. Additional detail regarding certain transactions and the effect on each segment at December 31 was as follows (in billions):



	2015						2016
	Automotive			Financial Services			Automotive			Financial Services
Trade and other receivables (a)				$	5.4					$	6.1
Unearned interest supplements and residual support (b)				(4.5		)				(5.3		)
Dealer financing and other financing receivables (c)				0.8						0.7
Net investment in operating leases (d)				0.7						0.9
Intersegment receivables/(payables) (e)	$	(1.1	)	1.1			$	(1.7	)	1.7

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(a)	Automotive receivables (generated primarily from vehicle and parts sales to third parties) sold to Ford Credit.


(b)	Automotive segment pays amounts to Ford Credit at the point of retail financing or lease origination which represent interest supplements and residual support.


(c)	Receivables with entities that are consolidated subsidiaries of Ford.


(d)	Sale-leaseback agreement between Automotive and Financial Services relating primarily to vehicles that we lease to our employees.


(e)	Reflects amounts owed to Financial Services by Automotive (these amounts include the balances related to the Dealer financing and other financing receivables described above).