Form 10-Q/A

10-Q/A 1 d10qa.htm FORM 10-Q/A Form 10-Q/A

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 10-Q/A

(Amendment No. 1)

(Mark One)

x	QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2005

¨	TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission file number 1-10667

AmeriCredit Corp.

(Exact name of registrant as specified in its charter)


Texas		75-2291093
(State or other jurisdiction of Incorporation or organization)		(I.R.S. Employer Identification No.)
		(I.R.S. Employer Identification No.)

801 Cherry Street, Suite 3900, Fort Worth, Texas 76102

(Address of principal executive offices, including Zip Code)

(817) 302-7000

(Registrant’s telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act.

Large accelerated filer x Accelerated filer ¨ Non-accelerated filer ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes ¨ No x

There were 136,791,005 shares of common stock, $0.01 par value outstanding as of October 31, 2005.

EXPLANATORY NOTE

AmeriCredit Corp. (the “Company”) hereby amends the Company’s Quarterly Report on the Form 10-Q for the three months ended September 30, 2005, filed with the Securities and Exchange Commission on November 8, 2005.

This amendment is being filed to reflect the restatement of the Company’s consolidated statements of cash flows, as discussed in Note 2 contained herein, and other information related to such restated financial information. Except for Items 1 and 4 of Part I, no other information included in the original report on Form 10-Q is amended by this Form 10-Q/A.

AMERICREDIT CORP.

INDEX TO FORM 10-Q/A


			Page
Part I.	FINANCIAL INFORMATION

	Item 1.	FINANCIAL STATEMENTS	3

		Consolidated Balance Sheets – September 30, 2005 and June 30, 2005	3

		Consolidated Statements of Income and Comprehensive Income – Three Months Ended September 30, 2005 and 2004	4

		Consolidated Statements of Cash Flows – Three Months Ended September 30, 2005 and 2004	5

		Notes to Consolidated Financial Statements	6

	Item 2.	MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS	28

	Item 3.	QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK	54

	Item 4.	CONTROLS AND PROCEDURES	55

Part II.	OTHER INFORMATION

	Item 1.	LEGAL PROCEEDINGS	55

	Item 2.	UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS	58

	Item 3.	DEFAULTS UPON SENIOR SECURITIES	58

	Item 4.	SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS	58

	Item 5.	OTHER INFORMATION	58

	Item 6.	EX HIBITS	59

SIGNATURE			60

Part I. FINANCIAL INFORMATION

Item 1. FINANCIAL STATEMENTS

AMERICREDIT CORP.

Consolidated Balance Sheets

(Unaudited, Dollars in Thousands)


	September 30, 2005			June 30, 2005
ASSETS
Cash and cash equivalents	$	692,476		$	663,501
Finance receivables, net		8,857,389			8,297,750
Interest-only receivables from Trusts		15,745			29,905
Investments in Trust receivables		181,903			239,446
Restricted cash – gain on sale Trusts		201,367			272,439
Restricted cash – securitization notes payable		674,600			633,900
Restricted cash – warehouse credit facilities		271,849			455,426
Property and equipment, net		59,406			92,000
Deferred income taxes		62,883			53,759
Other assets		218,048			208,912

Total assets	$	11,235,666		$	10,947,038

LIABILITIES AND SHAREHOLDERS’ EQUITY
Liabilities:
Warehouse credit facilities	$	1,104,740		$	990,974
Securitization notes payable		7,377,648			7,166,028
Senior notes		166,841			166,755
Convertible senior notes		200,000			200,000
Funding payable		235,573			158,210
Accrued taxes and expenses		145,914			133,736
Other liabilities		15,583			9,419

Total liabilities		9,246,299			8,825,122

Commitments and contingencies (Note 9)

Shareholders’ equity:
Preferred stock, $0.01 par value per share; 20,000,000 shares authorized, none issued Common stock, $0.01 par value per share; 230,000,000 shares authorized; 167,077,363 and 166,808,056 shares issued		1,671			1,668
Additional paid-in capital		1,160,514			1,150,612
Accumulated other comprehensive income		41,192			33,565
Retained earnings		1,387,667			1,333,634

		2,591,044			2,519,479
Treasury stock, at cost (29,257,188 and 21,180,057 shares)		(601,677	)		(397,563	)

Total shareholders’ equity		1,989,367			2,121,916

Total liabilities and shareholders’ equity	$	11,235,666		$	10,947,038

The accompanying notes are an integral part of these consolidated financial statements.

AMERICREDIT CORP.

Consolidated Statements of Income and Comprehensive Income

(Unaudited, Dollars in Thousands, Except Per Share Data)


	Three Months Ended September 30,
	2005			2004
Revenue
Finance charge income	$	373,736		$	269,928
Servicing income		25,341			59,357
Other income		21,186			10,671

		420,263			339,956

Costs and expenses
Operating expenses		77,865			74,001
Provision for loan losses		165,860			98,716
Interest expense		90,271			57,516
Restructuring charges, net		159			506

		334,155			230,739

Income before income taxes		86,108			109,217
Income tax provision		32,075			40,410

Net income		54,033			68,807

Other comprehensive income (loss)
Unrealized losses on credit enhancement assets		(4,008	)		(13,503	)
Unrealized gains (losses) on cash flow hedges		8,206			(2,098	)
Foreign currency translation adjustment		4,991			5,293
Income tax (provision) benefit		(1,562	)		6,027

Other comprehensive income (loss)		7,627			(4,281	)

Comprehensive income	$	61,660		$	64,526

Earnings per share
Basic	$	0.38		$	0.44

Diluted	$	0.35		$	0.41

Weighted average shares outstanding		142,735,494			155,611,880

Weighted average shares and assumed incremental shares		157,590,746			170,306,676

The accompanying notes are an integral part of these consolidated financial statements.

AMERICREDIT CORP.

Consolidated Statements of Cash Flows

(Unaudited, in Thousands)


	Three Months Ended September 30,
	2005			2004
	(Restated)			(Restated)
Cash flows from operating activities
Net income	$	54,033		$	68,807
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation and amortization		6,859			17,544
Provision for loan losses		165,860			98,716
Deferred income taxes		(9,109	)		1,468
Accretion of present value discount		(11,663	)		(27,126	)
Impairment of credit enhancement assets		457			91
Stock-based compensation expense		4,203			629
Other		(711	)		574
Changes in assets and liabilities:
Other assets		8,366			23,282
Accrued taxes and expenses		11,856			4,796

Net cash provided by operating activities		230,151			188,781

Cash flows from investing activities
Purchases of receivables		(1,621,939	)		(1,178,422	)
Principal collections and recoveries on receivables		976,538			705,827
Distributions from gain on sale Trusts, net of swap payments		143,018			100,282
Purchases of property and equipment		(902	)		(635	)
Sale of property		34,807
Change in restricted cash – securitization notes payable		(40,256	)		(31,940	)
Change in restricted cash – warehouse credit facilities		183,577			(297,601	)
Change in other assets		2,240			22,235

Net cash used by investing activities		(322,917	)		(680,254	)

Cash flows from financing activities
Net change in warehouse credit facilities		113,766			521,532
Issuance of securitization notes payable		1,100,000			800,000
Payments on securitization notes payable		(889,615	)		(669,787	)
Debt issuance costs		(3,532	)		(5,194	)
Repurchase of common stock		(204,114	)		(67,831	)
Net proceeds from issuance of common stock		3,407			19,586
Other net changes		(153	)		(3,098	)

Net cash provided by financing activities		119,759			595,208

Net increase in cash and cash equivalents		26,993			103,735
Effect of Canadian exchange rate changes on cash and cash equivalents		1,982			1,088
Cash and cash equivalents at beginning of period		663,501			421,450

Cash and cash equivalents at end of period	$	692,476		$	526,273

The accompanying notes are an integral part of these consolidated financial statements.

AMERICREDIT CORP.

Notes to Consolidated Financial Statements

(Unaudited)

NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Basis of Presentation

The consolidated financial statements include the accounts of AmeriCredit Corp. and its wholly-owned subsidiaries (the “Company”), including certain special purpose financing trusts utilized in securitization transactions (“Trusts”) which are considered variable interest entities. All significant intercompany transactions and accounts have been eliminated in consolidation.

The consolidated financial statements as of September 30, 2005, and for the three months ended September 30, 2005 and 2004, are unaudited, and in management’s opinion include all adjustments, consisting only of normal recurring adjustments, necessary for a fair presentation of the results for such interim periods. The results for interim periods are not necessarily indicative of results for a full year.

The interim period consolidated financial statements, including the notes thereto, are condensed and do not include all disclosures required by generally accepted accounting principles in the United States of America (“GAAP”). These interim period financial statements should be read in conjunction with the Company’s consolidated financial statements that are included in the Company’s Annual Report on Form 10-K for the year ended June 30, 2005.

Stock-based Compensation

Effective July 1, 2005, the Company adopted Statement of Financial Accounting Standards No. 123(R), “Share-Based Payment, revised 2004” (“SFAS 123R”), prospectively for all awards granted, modified or settled after June 30, 2005. The Company adopted the standard by using the modified prospective method that is one of the adoption methods provided for under SFAS 123R. SFAS 123R, which revised FASB Statement No. 123, “Accounting for Stock-Based Compensation” (“SFAS 123”), requires that the cost resulting from all share-based payment transactions be measured at fair value and recognized in the financial statements. Additionally, on July 1, 2005, the Company adopted Staff Accounting Bulletin No. 107 (“SAB 107”), which the Securities and Exchange Commission issued in March 2005 to provide its view on the valuation of share-based payment arrangements for public companies. For the three months ended September 30, 2005 and 2004, the Company has recorded total stock-based compensation expense of $4.2 million ($2.6 million net of tax) and $787,000 ($496,000 net of tax), respectively. Included in total stock-based compensation expense for the three months ended September 30, 2005, is an additional $1.6 million as a result of adoption of SFAS 123R and SAB 107 for amortization of outstanding options granted prior to the Company’s implementation of SFAS 123 on July 1, 2003, that vest subsequent to June 30, 2005. The remaining estimated pretax amortization on these outstanding options of $2.9 million will be recognized through December 31, 2006. The consolidated

statement of income for the three months ended September 30, 2004, has not been restated to reflect the amortization of these options. The fair value of the outstanding options that vested during the three months ended September 30, 2005, was immaterial.

The tax benefit of the stock option expense of $1.3 million for the three months ended September 30, 2005, has been included in other net changes as a cash inflow from financing activities on the consolidated statement of cash flows.

On July 1, 2003, the Company adopted the fair value recognition provision of SFAS 123, prospectively for all awards granted, modified or settled after June 30, 2003. The prospective method is one of the adoption methods provided for under Statement of Financial Accounting Standards No. 148, “Accounting for Stock-Based Compensation – Transition and Disclosure” issued in December 2002. SFAS 123 requires that compensation cost for all stock awards be calculated and recognized over the service period. This compensation cost is determined using option pricing models that are intended to estimate the fair value of awards at the grant date.

The following table illustrates the effect on net income and earnings per share had compensation expense for all options granted under the Company’s plans been determined using the fair value-based method and amortized over the expected life of the options (in thousands, except per share data):


	Three Months Ended
	September 30, 2004
	September 30, 2004
Net income as reported	$	68,807
Add: Stock-based compensation expense included in reported net income, net of related tax effects		496
Deduct: Stock-based compensation expense determined under fair value-based method, net of related tax effects		(4,314	)

Pro forma net income	$	64,989

Earnings per share:
Basic – as reported	$	0.44

Basic – pro forma	$	0.42

Diluted – as reported	$	0.41

Diluted – pro forma	$	0.39

There were no stock-based compensation arrangements granted or modified during the three months ended September 30, 2005 and 2004.

Diluted Earnings Per Share

In September 2004, the Emerging Issues Task Force reached a final consensus on EITF 04-8 to change the effect of contingently convertible debt within the dilutive earnings per share calculation. This change, which became effective for the three months ended December 31, 2004, resulted in the Company’s convertible senior notes being treated as convertible securities and included in dilutive earnings per share calculations using the if-converted method. EITF 04-8 required retroactive application beginning with the three months ended December 31, 2003, which was the first quarter the Company’s convertible senior notes were outstanding. Under EITF 04-8, diluted earnings per share decreased from $0.43 to $0.41 per share for the three months ended September 30, 2004.

NOTE 2 - RESTATEMENT

On January 23, 2006, the Company filed a Form 8-K reporting a restatement of its consolidated statements of cash flows for the years ended June 30, 2005, 2004, and 2003, and the three months ended September 30, 2005. As required by the Statement of Financial Accounting Standards No. 102, “Statement of Cash Flows-Exemption of Certain Enterprises and Classification of Cash Flows from Certain Securities Acquired for Resale,” paragraph 8, and related guidance set forth in statements made by the staff of the Securities and Exchange Commission (“SEC”) on December 5, 2005, the Company corrected its classification of the “distributions from gain on sale Trusts, net of swap payments” from an operating cash flow to an investing cash flow.

The related accounting guidance specifies, and the SEC comments clarified, that cash flows from retained interests accounted for as available for sale securities should be classified as investing cash inflows.

Additionally, as required by Statement of Financial Accounting Standards No. 95, “Statement of Cash Flows,” the Company corrected the classification of its non-cash adjustment of the amortization of certain direct loan costs from an investing cash flow to an operating cash flow. This item was previously identified by management and at that time was deemed immaterial to the previously reported operating and investing cash flows.

The reclassifications on the consolidated statements of cash flows do not result in a change to total cash and cash equivalents and there were no changes to the consolidated balance sheets and the consolidated statements of income. The reclassifications do, however, result in a change to total cash flows provided by operating activities and total cash flows used by investing activities.

The restatement resulted in the following changes to prior period financial statements (dollars in thousands):


	Years Ended June 30,
	2005			2004			2003
Net cash provided by operating activities:
As previously reported	$	1,122,065		$	812,262		$	2,303,580
As restated		613,962			504,683			2,175,463
Net cash used by investing activities:
As previously reported	$	(2,577,009	)	$	(1,269,169	)	$	(6,107,712	)
As restated		(2,068,906	)		(961,590	)		(5,979,595	)


	Three Months Ended September 30,
	2005			2004
Net cash provided by operating activities:
As previously reported	$	373,169		$	279,192
As restated		230,151			188,781
Net cash used by investing activities:
As previously reported	$	(465,935	)	$	(770,665	)
As restated		(322,917	)		(680,254	)

NOTE 3 - FINANCE RECEIVABLES

Finance receivables consist of the following (in thousands):


	September 30, 2005			June 30, 2005
Finance receivables unsecuritized, net of fees	$	1,245,689		$	845,061
Finance receivables securitized, net of fees		8,217,194			7,993,907
Less nonaccretable acquisition fees		(203,687	)		(199,810	)
Less allowance for loan losses		(401,807	)		(341,408	)

	$	8,857,389		$	8,297,750

Finance receivables securitized represent receivables transferred to the Company’s special purpose finance subsidiaries in securitization transactions accounted for as secured financings. Finance receivables unsecuritized include $939.6 million and $607.7 million pledged under the Company’s warehouse credit facilities as of September 30 and June 30, 2005, respectively.

The accrual of finance charge income has been suspended on $514.5 million and $378.3 million of delinquent finance receivables as of September 30 and June 30, 2005, respectively.

Finance contracts are generally purchased by the Company from auto dealers without recourse, and accordingly, the dealer usually has no liability to the Company if the consumer defaults on the contract. Depending upon the contract structure and consumer credit attributes, the Company may charge the dealer a non-refundable acquisition fee when purchasing individual finance contracts. The Company recorded acquisition fees on loans purchased prior to July 1, 2004, as nonaccretable fees available to cover losses inherent in the loan portfolio. Additionally, the Company records a discount on finance receivables repurchased upon the exercise of a cleanup call option from its gain on sale securitization transactions and accounts for such discounts as nonaccretable discounts available to cover losses inherent in the repurchased finance receivables.

A summary of the nonaccretable acquisition fees is as follows (in thousands):


	Three Months Ended September 30,
	2005			2004
Balance at beginning of period	$	199,810		$	176,203
Purchases of receivables		7,589			4,988
Net charge-offs		(3,712	)		(4,554	)

Balance at end of period	$	203,687		$	176,637

A summary of the allowance for loan losses is as follows (in thousands):


	Three Months Ended September 30,
	2005			2004
Balance at beginning of period	$	341,408		$	242,208
Provision for loan losses		165,860			98,716
Net charge-offs		(105,461	)		(70,427	)

Balance at end of period	$	401,807		$	270,497

NOTE 4 - SECURITIZATIONS

A summary of the Company’s securitization activity and cash flows from the Trusts is as follows (in thousands):


	Three Months Ended September 30,
	2005		2004
Receivables securitized	$	1,189,191	$	874,318
Net proceeds from securitization		1,100,000		800,000
Servicing fees:
Sold		14,135		32,322
Secured financing (a)		50,917		39,680
Distributions from Trusts, net of swap payments:
Sold		143,018		100,282
Secured financing		153,115		150,660

(a)

Servicing fees earned on securitizations accounted for as secured financings are included in finance charge income on the consolidated statements of income.

As of September 30 and June 30, 2005, the Company was servicing $9,808.1 million and $10,157.8 million, respectively, of finance receivables that have been sold or transferred to securitization Trusts.

NOTE 5 – CREDIT ENHANCEMENT ASSETS

Credit enhancement assets represent the present value of the Company’s retained interests in securitizations accounted for as sales. Credit enhancement assets consist of the following (in thousands):


	September 30, 2005		June 30, 2005
Interest-only receivables from Trusts	$	15,745	$	29,905
Investments in Trust receivables		181,903		239,446
Restricted cash – gain on sale Trusts		201,367		272,439

	$	399,015	$	541,790

A summary of activity in the credit enhancement assets is as follows (in thousands):


	Three Months Ended September 30,
	2005			2004
Balance at beginning of period	$	541,790		$	1,062,322
Distributions from Trusts		(143,018	)		(103,229	)
Accretion of present value discount		1,819			16,777
Other-than-temporary impairment		(457	)		(91	)
Change in unrealized gain		(1,358	)		(8,027	)
Foreign currency translation adjustment		239			512

Balance at end of period	$	399,015		$	968,264

Significant assumptions used in measuring the estimated fair value of credit enhancement assets related to the gain on sale Trusts at the balance sheet dates are as follows:


	September 30, 2005	June 30, 2005
Cumulative credit losses	12.6% - 14.9%	12.4% - 14.8%
Discount rate used to estimate present value:
Interest-only receivables from Trusts	14.0%	14.0%
Investments in Trust receivables	9.8%	9.8%
Restricted cash	9.8%	9.8%

NOTE 6 – WAREHOUSE CREDIT FACILITIES

Amounts outstanding under the Company’s warehouse credit facilities are as follows (in thousands):


	September 30, 2005		June 30, 2005
Commercial paper facility	$	31,660
Medium term note facility		650,000	$	650,000
Repurchase facility		230,182		215,613
Near prime facility		192,898		125,361

	$	1,104,740	$	990,974

Further detail regarding terms and availability of the warehouse credit facilities as of September 30, 2005, follows (in thousands):


Maturity	Facility Amount		Advances Outstanding		Finance Receivables Pledged		Restricted Cash Pledged (d)
Commercial paper facility:
November 2007 (a)(b)	$	1,950,000	$	31,660	$	34,908	$	1,000
Medium term note:
October 2007 (a)(c)		650,000		650,000		475,489		224,089
Repurchase facility:
August 2006 (a)		500,000		230,182		227,541		6,546
Near prime facility:
July 2006 (a)		400,000		192,898		201,644		1,982

	$	3,500,000	$	1,104,740	$	939,582	$	233,617

(a)

At the maturity date, the outstanding debt balance can either be repaid in full or over time based on the amortization of receivables pledged.

(b)

$150.0 million of this facility matures in November 2005, and the remaining $1,800.0 million matures in November 2007.

(c)

This facility is a revolving facility through the date stated above. During the revolving period, the Company has the ability to substitute receivables for cash, or vice versa.

(d)

These amounts do not include cash collected on finance receivables pledged of $38.2 million which is also included in restricted cash – warehouse credit facilities on the consolidated balance sheets.

In November 2005, the Company renewed its $1,950.0 million commercial paper facility, extending the $150.0 million one-year maturity to November 2006 and the $1,800.0 million three year maturity to November 2008.

The Company’s warehouse credit facilities are administered by agents on behalf of institutionally managed commercial paper or medium term note conduits. Under these funding agreements, the Company transfers finance receivables to special purpose finance subsidiaries of the Company. These subsidiaries, in turn, issue notes to the agents, collateralized by such finance receivables and cash. The agents provide funding under the notes to the subsidiaries pursuant to an advance formula, and the subsidiaries forward the funds to the Company in

consideration for the transfer of finance receivables. While these subsidiaries are included in the Company’s consolidated financial statements, these subsidiaries are separate legal entities and the finance receivables and other assets held by these subsidiaries are legally owned by these subsidiaries and are not available to creditors of AmeriCredit Corp. or its other subsidiaries. Advances under the funding agreements bear interest at commercial paper, LIBOR or prime rates plus specified fees depending upon the source of funds provided by the agents.

The Company is required to hold certain funds in restricted cash accounts to provide additional collateral for borrowings under the facilities. Additionally, certain funding agreements contain various covenants requiring minimum financial ratios, asset quality, and portfolio performance ratios (cumulative net loss, delinquency and repossession ratios) as well as limits on deferment levels. Failure to meet any of these covenants could result in an event of default under these agreements. If an event of default occurs under these agreements, the lenders could elect to declare all amounts outstanding under these agreements to be immediately due and payable, enforce their interests against collateral pledged under these agreements or restrict the Company’s ability to obtain additional borrowings under these agreements. As of September 30, 2005, all of the Company’s warehouse credit facilities were in compliance with all covenants.

Debt issuance costs are being amortized over the expected term of the warehouse credit facilities. Unamortized costs of $8.6 million and $9.6 million as of September 30 and June 30, 2005, respectively, are included in other assets on the consolidated balance sheets.

NOTE 7 – SECURITIZATION NOTES PAYABLE

Securitization notes payable represents debt issued by the Company in securitization transactions accounted for as secured financings. Debt issuance costs are being amortized over the expected term of the securitizations; accordingly, unamortized costs of $22.8 million and $23.3 million as of September 30 and June 30, 2005, respectively, are included in other assets on the consolidated balance sheets.

Securitization notes payable consists of the following (dollars in thousands):


Transaction	Maturity Date (c)	Original Note Amount		Original Weighted Average Interest Rate		Receivables Pledged		Note Balance
2002-E-M	June 2009	$	1,700,000	3.2	%	$	450,057	$	417,672
C2002-1 Canada (a)	December 2009		137,000	5.5	%		49,301		20,516
2003-A-M	November 2009		1,000,000	2.6	%		320,798		282,733
2003-B-X	January 2010		825,000	2.3	%		281,556		248,811
2003-C-F	May 2010		915,000	2.8	%		342,537		301,186
2003-D-M	August 2010		1,200,000	2.3	%		524,304		449,532
2004-A-F	February 2011		750,000	2.3	%		350,824		307,783
2004-B-M	March 2011		900,000	2.2	%		481,122		415,941
2004-1 (b)	July 2010		575,000	3.7	%		399,505		295,577
2004-C-A	May 2011		800,000	3.2	%		566,577		495,615
2004-D-F	July 2011		750,000	3.1	%		572,364		512,101
2005-A-X	October 2011		900,000	3.7	%		750,254		673,340
2005-1	May 2011		750,000	4.5	%		666,211		629,402
2005-B-M	May 2012		1,350,000	4.1	%		1,313,048		1,227,467
2005-C-F	June 2012		1,100,000	4.5	%		1,148,736		1,099,972

		$	13,652,000			$	8,217,194	$	7,377,648

(a)

Note balances do not include $25.7 million of asset-backed securities issued and retained by the Company as of September 30, 2005. The balances reflect fluctuations in foreign currency translation rates and principal paydowns.

(b)

Note balances do not include $7.4 million of asset-backed securities retained by the Company as of September 30, 2005.

(c)

Maturity date represents final legal maturity of securitization notes payable. Securitization notes payable are expected to be paid based on amortization of the finance receivables pledged to the Trusts.

NOTE 8 – DERIVATIVE FINANCIAL INSTRUMENTS AND HEDGING ACTIVITIES

As of September 30 and June 30, 2005, the Company had interest rate swap agreements associated with its securitization Trusts and its medium term note facility with underlying notional amounts of $1,554.3 million and $1,722.1 million, respectively. The fair value of the Company’s interest rate swap agreements of $16.2 million and $7.3 million as of September 30 and June 30, 2005, respectively, are included in other assets on the consolidated balance sheets. Interest rate swap agreements designated as hedges had unrealized gains of $14.5 million and $6.3 million included in accumulated other comprehensive income as of September 30 and June 30, 2005, respectively. The ineffectiveness related to the interest rate swap agreements designated as hedges was not material for the three month periods ended September 30, 2005 and 2004. The Company estimates approximately $11.0 million of unrealized gains included in other comprehensive income will be reclassified into earnings within the next twelve months.

As of September 30 and June 30, 2005, the Company had interest rate cap agreements with underlying notional amounts of $1,902.7 million and $1,219.0 million, respectively. The fair value of the Company’s interest rate cap agreements purchased by its special purpose finance subsidiaries of $4.1

million and $1.3 million as of September 30 and June 30, 2005, respectively, are included in other assets on the consolidated balance sheets. The fair value of the Company’s interest rate cap agreements sold by the Company of $4.0 million and $1.1 million as of September 30 and June 30, 2005, respectively, are included in other liabilities on the consolidated balance sheets.

Under the terms of its derivative financial instruments, the Company is required to pledge certain funds to be held in restricted cash accounts as collateral for the outstanding derivative transactions. As of September 30 and June 30, 2005, these restricted cash accounts totaled $4.5 million and $6.7 million, respectively, and are included in other assets on the consolidated balance sheets.

NOTE 9 – COMMITMENTS AND CONTINGENCIES

Guarantees of Indebtedness

The payments of principal and interest on the Company’s senior notes and convertible senior notes are guaranteed by certain of the Company’s subsidiaries. The carrying value of the senior notes and convertible senior notes was $366.8 million as of September 30 and June 30, 2005, respectively. See guarantor consolidating financial statements in Note 15.

Legal Proceedings

As a consumer finance company, the Company is subject to various consumer claims and litigation seeking damages and statutory penalties, based upon, among other things, usury, disclosure inaccuracies, wrongful repossession, violations of bankruptcy stay provisions, certificate of title disputes, fraud, breach of contract and discriminatory treatment of credit applicants. Some litigation against the Company could take the form of class action complaints by consumers. As the assignee of finance contracts originated by dealers, the Company may also be named as a co-defendant in lawsuits filed by consumers principally against dealers. The damages and penalties claimed by consumers in these types of matters can be substantial. The relief requested by the plaintiffs varies but can include requests for compensatory, statutory and punitive damages. The Company believes that it has taken prudent steps to address and mitigate the litigation risks associated with its business activities.

Company to avoid delinquency triggers in securitization transactions and enhance cash flows and to incorrectly report charge-offs and delinquency percentages, thereby causing the Company to misrepresent its financial performance throughout the alleged class period. The plaintiff also alleges that the Company’s registration statement and prospectus for the offering contained untrue statements of material facts and omitted to state material facts necessary to make other statements in the registration statement not misleading.

On September 30, 2005, the Court issued an Order that the Company’s and the individual defendants motion to dismiss should be partially granted and partially denied and that the plaintiff should be given one final opportunity to re-plead the complaint only as to those claims brought pursuant to the Securities Act of 1933. The Court dismissed the claims alleging violations of Section 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder. Pursuant to the Court’s Order, on October 28, 2005, the plaintiff filed a second amended consolidated complaint concerning the Securities Act of 1933 claims.

The Company believes that the claims alleged in the Pierce lawsuit are without merit and the Company intends to assert vigorous defenses to the litigation. Neither the likelihood of an unfavorable outcome nor the amount of ultimate liability, if any, with respect to this litigation can be determined at this time.

Two shareholder derivative actions have also been served on the Company. On February 27, 2003, the Company was served with a shareholder’s derivative action filed in the United States District Court for the Northern District of Texas, Fort Worth Division, entitled Mildred Rosenthal, derivatively and on behalf of nominal defendant AmeriCredit Corp. v. Clifton H. Morris, Jr., et al. A second shareholder derivative action was filed in the District Court of Tarrant County, Texas 48^th Judicial District, on August 19, 2003, entitled David Harris, derivatively and on behalf of nominal defendant AmeriCredit Corp. v. Clifton H. Morris, Jr., et al. Both of these shareholder derivative actions allege, among other complaints, that certain officers and directors of the Company breached their respective fiduciary duties by causing the Company to make improper deferments, violate federal and state securities laws and issue misleading financial statements. The substantive allegations in both of the derivative actions are essentially the same as those in the above-referenced consolidated class action. A special litigation committee (“SLC”) of the Board of Directors was created to investigate the claims in the derivative actions. In September 2005, the SLC completed its investigation of the claims made by the derivative plaintiffs in Rosenthal and Harris and rendered its decision that continuation of the derivative proceeding is not in the best interests of the Company. Accordingly, the Company has filed a Motion to Dismiss each derivative complaint. As a nominal defendant, the Company does not believe that it has any ultimate liability with respect to these derivative actions.

NOTE 10 – COMMON STOCK

During the three months ended September 30, 2005, the Company repurchased 8,077,131 shares of its common stock at an average cost of $25.27 per share, under stock repurchase plans approved by the Board of Directors since April 2004. During October 2005, the Company repurchased an additional 1,131,131 shares of its common stock at an average cost of $23.16 per share. On October 25, 2005, the Company announced the approval of another stock repurchase plan by its Board of Directors. The new stock repurchase plan authorizes the Company to repurchase up to $300.0 million of its common stock in the open market or in privately negotiated transactions based on market conditions. As of October 31, 2005, the Company has remaining authorization to repurchase $375.0 million of its common stock.

NOTE 11 – STOCK-BASED COMPENSATION

General

The Company has certain stock-based compensation plans for employees, non-employee directors and key executive officers.

Total unamortized stock-based compensation was $25.5 million at September 30, 2005, and will be recognized over the weighted average service period of 1.7 years.

Employee Plans

A summary of stock option activity under the Company’s employee plans for the three months ended September 30, 2005, is as follows (in thousands, except weighted average exercise price):


	Shares		Weighted Average Exercise Price		Aggregate Intrinsic Value
Outstanding at June 30, 2005	7,569		$	15.39
Exercised	(269	)		12.65
Canceled/forfeited	(94	)		16.83

Outstanding at September 30, 2005	7,206		$	15.47	$	60,513

Options exercisable at September 30, 2005	5,961		$	16.49	$	43,999

Cash received from exercise of options for the three months ended September 30, 2005, was $3.4 million. Options exercised are issued as new shares. The total intrinsic value of options exercised during the three months ended September 30, 2005, was $3.4 million.

Non-Employee Director Plans

Stock options outstanding and exercisable under the Company’s non-employee director plans remained at 270,000 shares with no activity for the three months ended September 30, 2005. These shares have a weighted average exercise price of $14.57 and an aggregate intrinsic value of $2.5 million.

Key Executive Officer Plans

Stock options outstanding and exercisable under the Company’s key executive officer plans remained at 2,672,000 shares with no activity for the three months ended September 30, 2005. These shares have a weighted average exercise price of $11.40 and an aggregate intrinsic value of $33.3 million.

Restricted stock grants totaling 587,500 shares with an approximate aggregate market value of $14.1 million at the time of grant have been issued under the employee plans. The market value of these restricted shares at the date of grant is being amortized into expense over a period that approximates the service period of three years. The restricted stock granted is subject to a vesting schedule of 25% in March 2006, 25% in March 2007 and 50% in March 2008. Compensation expense recognized for restricted stock grants was $1.0 million for the three months ended September 30, 2005. As of September 30 and June 30, 2005, unamortized compensation expense, which is included in additional paid-in capital, related to the restricted stock awards was $10.9 million and $12.6 million, respectively. A summary of the status of non-vested restricted stock for the three months ended September 30, 2005, is presented below:


Non-vested restricted stock at June 30, 2005	577,300
Forfeited	(18,000	)

Non-vested restricted stock at September 30, 2005	559,300

Stock appreciation rights with respect to 680,600 shares with an approximate aggregate market value of $9.7 million at the time of grant have been issued under the employee plans. The market value of these rights at the date of grant is being amortized into expense over a period that approximates the service period of three years. Stock appreciation rights with respect to 640,000 shares are subject to vesting schedules of 25% that vested in June 2005, 25% that will vest in March 2007 and 50% that will vest in March 2008. The remaining stock appreciation rights are subject to vesting schedules of 25% in March 2006, 25% in March 2007 and 50% in March 2008. Compensation expense recognized for stock appreciation rights was $0.8 million for the three months ended September 30, 2005. As of September 30 and June 30, 2005, unamortized compensation expense related to the rights was $7.9 million and $8.7 million, respectively. A summary of the status of non-vested stock appreciation rights for the three months ended September 30, 2005, is presented below:


Non-vested stock appreciation rights at June 30, 2005	520,600
Forfeited	(2,900	)

Non-vested stock appreciation rights at September 30, 2005	517,700

NOTE 12 – RESTRUCTURING CHARGES

The Company recognized restructuring charges of $159,000 and $506,000 during the three months ended September 30, 2005 and 2004, respectively, relating to a revision of assumed lease costs for office space and collections centers in connection with the Company’s restructuring activities during the years ended June 30, 2004 and 2003.

As of September 30, 2005, total costs incurred to date in connection with the closing of the Jacksonville collections center and the abandonment of excess capacity at the Company’s Chandler collections center and corporate headquarters in fiscal 2004 includes $2.2 million in personnel-related costs and $13.5 million of contract termination and other associated costs. Total costs incurred to date in connection with the revision of the Company’s operating plan in February 2003 includes $18.8 million in personnel-related costs, $26.5 million of contract termination costs and $28.3 million in other associated costs. The accruals remain for contract term and other associated costs which are long term liabilities.

A summary of the liabilities, which are included in accrued taxes and expenses on the consolidated balance sheets, for the restructuring charges for the three months ended September 30, 2005, is as follows (in thousands):


	Contract Termination Costs			Other Associated Costs			Total
Balance at June 30, 2005	$	13,498		$	2,959		$	16,457
Cash settlements		(842	)					(842	)
Non-cash settlements		(352	)		(90	)		(442	)
Adjustments		159						159

Balance at September 30, 2005	$	12,463		$	2,869		$	15,332

NOTE 13 – EARNINGS PER SHARE

A reconciliation of weighted average shares used to compute basic and diluted earnings per share is as follows (dollars in thousands, except per share data):


	Three Months Ended September 30,
	2005		2004
Net income	$	54,033	$	68,807
Interest expense related to convertible senior notes, net of related tax effects		715		715

Adjusted net income	$	54,748	$	69,522

Weighted average shares outstanding		142,735,494		155,611,880
Incremental shares resulting from assumed conversions:
Stock-based compensation		3,331,719		3,276,978
Warrants		818,328		712,613
Convertible senior notes		10,705,205		10,705,205

		14,855,252		14,694,796

Weighted average shares and assumed incremental shares		157,590,746		170,306,676

Earnings per share:
Basic	$	0.38	$	0.44

Diluted	$	0.35	$	0.41

Basic earnings per share have been computed by dividing net income by weighted average shares outstanding.

Diluted earnings per share have been computed by dividing net income, adjusted for interest expense (net of related tax effects) related to the Company’s convertible senior notes, by the weighted average shares and assumed incremental shares. The treasury stock method was used to compute the assumed incremental shares related to the Company’s outstanding stock-based compensation and warrants. The average common stock market prices for the periods were used to determine the number of incremental shares. Options to purchase approximately 0.7 million and 1.0 million shares of common stock at September 30, 2005 and 2004, respectively, were not included in the computation of diluted earnings per share because the option exercise price was greater than the average market price of the common shares.

The if-converted method was used to calculate the impact of the Company’s convertible senior notes on assumed incremental shares. As required by EITF 04-8, assumed incremental shares for the three months ended September 30, 2004, were retroactively adjusted for the impact of the convertible senior notes.

NOTE 14 - SUPPLEMENTAL CASH FLOW INFORMATION

Cash payments for interest costs and income taxes consist of the following (in thousands):


	Three Months Ended September 30,
	2005		2004
Interest costs (none capitalized)	$	79,479	$	50,747
Income taxes		23,486		32,085

NOTE 15 - GUARANTOR CONSOLIDATING FINANCIAL STATEMENTS

The payments of principal and interest on the Company’s senior notes and convertible senior notes are guaranteed by certain of the Company’s subsidiaries (the “Subsidiary Guarantors”). The separate financial statements of the Subsidiary Guarantors are not included herein because the Subsidiary Guarantors are wholly-owned consolidated subsidiaries of the Company and are jointly, severally and unconditionally liable for the obligations represented by the senior notes and convertible senior notes. The Company believes that the consolidating financial information for the Company, the combined Subsidiary Guarantors and the combined Non-Guarantor Subsidiaries provide information that is more meaningful in understanding the financial position of the Subsidiary Guarantors than separate financial statements of the Subsidiary Guarantors.

The following consolidating financial statement schedules present consolidating financial data for (i) AmeriCredit Corp. (on a parent only basis), (ii) the combined Subsidiary Guarantors, (iii) the combined Non-Guarantor Subsidiaries, (iv) an elimination column for adjustments to arrive at the information for the Company and its subsidiaries on a consolidated basis and (v) the Company and its subsidiaries on a consolidated basis.

Investments in subsidiaries are accounted for by the parent company using the equity method for purposes of this presentation. Results of operations of subsidiaries are therefore reflected in the parent company’s investment accounts and earnings. The principal elimination entries set forth below eliminate investments in subsidiaries and intercompany balances and transactions.

AmeriCredit Corp.

Consolidating Balance Sheet

September 30, 2005

(Unaudited, in Thousands)


	AmeriCredit Corp.			Guarantors		Non-Guarantors		Eliminations			Consolidated
ASSETS

Cash and cash equivalents				$	686,680	$	5,796				$	692,476
Finance receivables, net					255,086		8,602,303					8,857,389
Interest-only receivables from Trusts							15,745					15,745
Investments in Trust receivables					155		181,748					181,903
Restricted cash - gain on sale Trusts					4,008		197,359					201,367
Restricted cash - securitization notes payable							674,600					674,600
Restricted cash - warehouse credit facilities							271,849					271,849
Property and equipment, net	$	6,777			52,628		1					59,406
Deferred income taxes		(6,364	)		15,327		53,920					62,883
Other assets		5,829			153,838		59,285	$	(904	)		218,048
Due from affiliates		991,242					733,859		(1,725,101	)
Investment in affiliates		1,439,154			2,359,295		452,129		(4,250,578	)

Total assets	$	2,436,638		$	3,527,017	$	11,248,594	$	(5,976,583	)	$	11,235,666

LIABILITIES AND SHAREHOLDERS’ EQUITY

Liabilities:
Warehouse credit facilities						$	1,104,740				$	1,104,740
Securitization notes payable							7,425,276	$	(47,628	)		7,377,648
Senior notes	$	166,841										166,841
Convertible senior notes		200,000										200,000
Funding payable				$	235,129		444					235,573
Accrued taxes and expenses		74,737			25,499		46,582		(904	)		145,914
Other liabilities		5,693			9,890							15,583
Due to affiliates					1,703,176				(1,703,176	)

Total liabilities		447,271			1,973,694		8,577,042		(1,751,708	)		9,246,299

Shareholders’ equity:
Common stock		1,671			75,355		30,627		(105,982	)		1,671
Additional paid-in capital		1,160,514			75,670		791,018		(866,688	)		1,160,514
Accumulated other comprehensive income		41,192			22,111		34,042		(56,153	)		41,192
Retained earnings		1,387,667			1,380,187		1,815,865		(3,196,052	)		1,387,667
		2,591,044			1,553,323		2,671,552		(4,224,875	)		2,591,044
Treasury stock		(601,677	)									(601,677	)

Total shareholders’ equity		1,989,367			1,553,323		2,671,552		(4,224,875	)		1,989,367

Total liabilities and shareholders’ equity	$	2,436,638		$	3,527,017	$	11,248,594	$	(5,976,583	)	$	11,235,666

AmeriCredit Corp.

Consolidating Balance Sheet

June 30, 2005

(in thousands)


	AmeriCredit Corp.			Guarantors		Non-Guarantors		Eliminations			Consolidated
ASSETS

Cash and cash equivalents				$	663,501						$	663,501
Finance receivables, net					213,175	$	8,084,575					8,297,750
Interest-only receivables from Trusts							29,905					29,905
Investments in Trust receivables					1,094		238,352					239,446
Restricted cash - gain on sale Trusts					3,805		268,634					272,439
Restricted cash - securitization notes payable							633,900					633,900
Restricted cash - warehouse credit facilities							455,426					455,426
Property and equipment, net	$	6,860			85,139		1					92,000
Deferred income taxes		(46,264	)		13,240		86,783					53,759
Other assets		6,270			154,906		58,080	$	(10,344	)		208,912
Due from affiliates		1,196,054					1,161,307		(2,357,361	)
Investment in affiliates		1,385,395			2,886,483		330,277		(4,602,155	)

Total assets	$	2,548,315		$	4,021,343	$	11,347,240	$	(6,969,860	)	$	10,947,038

LIABILITIES AND SHAREHOLDERS’ EQUITY

Liabilities:
Warehouse credit facilities						$	990,974				$	990,974
Securitization notes payable							7,218,487	$	(52,459	)		7,166,028
Senior notes	$	166,755										166,755
Convertible senior notes		200,000										200,000
Funding payable				$	157,615		595					158,210
Accrued taxes and expenses		52,642			39,658		51,780		(10,344	)		133,736
Other liabilities		7,002			2,417							9,419
Due to affiliates					2,329,302				(2,329,302	)

Total liabilities		426,399			2,528,992		8,261,836		(2,392,105	)		8,825,122

Shareholders’ equity:
Common stock		1,668			75,355		30,627		(105,982	)		1,668
Additional paid-in capital		1,150,612			75,670		1,263,713		(1,339,383	)		1,150,612
Accumulated other comprehensive income		33,565			11,280		35,259		(46,539	)		33,565
Retained earnings		1,333,634			1,330,046		1,755,805		(3,085,851	)		1,333,634

		2,519,479			1,492,351		3,085,404		(4,577,755	)		2,519,479
Treasury stock		(397,563	)									(397,563	)

Total shareholders’ equity		2,121,916			1,492,351		3,085,404		(4,577,755	)		2,121,916

Total liabilities and shareholders’ equity	$	2,548,315		$	4,021,343	$	11,347,240	$	(6,969,860	)	$	10,947,038

AmeriCredit Corp.

Consolidating Statement of Income

Three Months Ended September 30, 2005

(Unaudited, in Thousands)


	AmeriCredit Corp.		Guarantors			Non-Guarantors		Eliminations			Consolidated
Revenue
Finance charge income			$	24,894		$	348,842				$	373,736
Servicing income				15,150			10,191					25,341
Other income	$	15,727		278,231			586,194	$	(858,966	)		21,186
Equity in income of affiliates		50,141		60,060					(110,201	)

		65,868		378,335			945,227		(969,167	)		420,263

Costs and expenses
Operating expenses		4,126		21,822			51,917					77,865
Provision for loan losses				20,977			144,883					165,860
Interest expense		5,399		291,124			652,714		(858,966	)		90,271
Restructuring charges				159								159

		9,525		334,082			849,514		(858,966	)		334,155

Income before income taxes		56,343		44,253			95,713		(110,201	)		86,108

Income tax provision		2,310		(5,888	)		35,653					32,075

Net income	$	54,033	$	50,141		$	60,060	$	(110,201	)	$	54,033

AmeriCredit Corp.

Consolidating Statement of Income

Three Months Ended September 30, 2004

(Unaudited, in Thousands)


	AmeriCredit Corp.		Guarantors			Non-Guarantors		Eliminations			Consolidated
Revenue
Finance charge income			$	20,497		$	249,431				$	269,928
Servicing income				30,463			28,894					59,357
Other income	$	8,622		146,442			264,515	$	(408,908	)		10,671
Equity in income of affiliates		68,647		39,680					(108,327	)

		77,269		237,082			542,840		(517,235	)		339,956

Costs and expenses
Operating expenses		2,730		31,362			39,909					74,001
Provision for loan losses				(22,510	)		121,226					98,716
Interest expense		5,638		142,065			318,721		(408,908	)		57,516
Restructuring charges				506								506

		8,368		151,423			479,856		(408,908	)		230,739

Income before income taxes		68,901		85,659			62,984		(108,327	)		109,217

Income tax provision		94		17,012			23,304					40,410

Net income	$	68,807	$	68,647		$	39,680	$	(108,327	)	$	68,807

AmeriCredit Corp.

Consolidating Statement of Cash Flows

Three Months Ended September 30, 2005

RESTATED

(Unaudited, in Thousands)


	AmeriCredit Corp.			Guarantors			Non-Guarantors			Eliminations			Consolidated
Cash flows from operating activities:
Net income	$	54,033		$	50,141		$	60,060		$	(110,201	)	$	54,033
Adjustments to reconcile net income to net cash (used) provided by operating activities:
Depreciation and amortization		615			2,704			3,540						6,859
Provision for loan losses					20,977			144,883						165,860
Deferred income taxes		(38,944	)		(5,845	)		35,680						(9,109	)
Accretion of present value discount					(117	)		(11,546	)					(11,663	)
Impairment of credit enhancement assets					268			189						457
Stock-based compensation expense		4,203												4,203
Other					(564	)		(147	)					(711	)

Equity in income of affiliates		(50,141	)		(60,060	)					110,201
Changes in assets and liabilities:
Other assets		(1	)		4,599			3,768						8,366
Accrued taxes and expenses		22,095			(4,637	)		(5,602	)					11,856

Net cash (used) provided by operating activities		(8,140	)		7,466			230,825						230,151

Cash flows from investing activities:
Purchases of receivables					(1,621,939	)		(1,616,023	)		1,616,023			(1,621,939	)
Principal collections and recoveries on receivables					13,457			963,081						976,538
Net proceeds from sale of receivables					1,616,023						(1,616,023	)
Distributions from gain on sale
Trusts, net of swap payments					706			142,312						143,018
Purchases of property and equipment					(902	)								(902	)
Sale of property					34,807									34,807
Change in restricted cash - securitization notes payable								(40,256	)					(40,256	)
Change in restricted cash - warehouse credit facilities								183,577						183,577
Change in other assets					2,240									2,240
Net change in investment in affiliates		(982	)		594,546			(121,850	)		(471,714	)

Net cash provided (used) by investing activities		(982	)		638,938			(489,159	)		(471,714	)		(322,917	)

Cash flows from financing activities:
Net change in warehouse credit facilities								113,766						113,766
Issuance of securitization notes payable								1,100,000						1,100,000
Payments on securitization notes payable								(889,615	)					(889,615	)
Debt issuance costs		(5	)					(3,527	)					(3,532	)
Repurchase of common stock		(204,114	)											(204,114	)
Net proceeds from issuance of common stock		3,407						(472,695	)		472,695			3,407
Other net changes		31			(184	)								(153	)
Net change in due (to) from affiliates		204,812			(624,669	)		416,193			3,664

Net cash provided (used) by financing activities		4,131			(624,853	)		264,122			476,359			119,759

Net (decrease) increase in cash and cash equivalents		(4,991	)		21,551			5,788			4,645			26,993
Effect of Canadian exchange rate changes on cash and cash equivalents		4,991			1,628			8			(4,645	)		1,982
Cash and cash equivalents at beginning of period					663,501									663,501

Cash and cash equivalents at end of period	$			$	686,680		$	5,796		$			$	692,476

AmeriCredit Corp.

Consolidating Statement of Cash Flows

Three Months Ended September 30, 2004

RESTATED

(Unaudited, in Thousands)


	AmeriCredit Corp.			Guarantors			Non-Guarantors			Eliminations			Consolidated
Cash flows from operating activities:
Net income	$	68,807		$	68,647		$	39,680		$	(108,327	)	$	68,807
Adjustments to reconcile net income to net cash (used) provided by operating activities:
Depreciation and amortization		688			3,509			13,347						17,544
Provision for loan losses					(22,510	)		121,226						98,716
Deferred income taxes		223,532			86,512			(308,576	)					1,468
Accretion of present value discount					4,175			(31,301	)					(27,126	)
Impairment of credit enhancement assets								91						91
Stock-based compensation expense		629												629
Other					668			(94	)					574

Equity in income of affiliates		(68,647	)		(39,680	)					108,327
Changes in assets and liabilities:
Other assets		1,801			16,502			4,979						23,282
Accrued taxes and expenses		8,709			(9,125	)		5,212						4,796

Net cash provided (used) by operating activities		235,519			108,698			(155,436	)					188,781

Cash flows from investing activities:
Purchases of receivables					(1,178,422	)		(1,183,002	)		1,183,002			(1,178,422	)
Principal collections and recoveries on receivables					14,370			691,457						705,827
Net proceeds from sale of receivables					1,183,002						(1,183,002	)
Distributions from gain on sale
Trusts, net of swap payments					(860	)		101,142						100,282
Purchases of property and equipment					(635	)								(635	)
Change in restricted cash - securitization notes payable								(31,940	)					(31,940	)
Change in restricted cash - warehouse credit facilities								(297,601	)					(297,601	)
Change in other assets					22,235									22,235
Net change in investment in affiliates		8,252			1,784,778			(122,974	)		(1,670,056	)

Net cash provided (used) by investing activities		8,252			1,824,468			(842,918	)		(1,670,056	)		(680,254	)

Cash flows from financing activities:
Net change in warehouse credit facilities								521,532						521,532
Issuance of securitization notes payable								800,000						800,000
Payments on securitization notes payable								(669,787	)					(669,787	)
Debt issuance costs		(10	)		(777	)		(4,407	)					(5,194	)
Repurchase of common stock		(67,831	)											(67,831	)
Net proceeds from issuance of common stock		19,586						(1,646,380	)		1,646,380			19,586
Other net changes		(2,872	)		(226	)								(3,098	)
Net change in due (to) from affiliates		(197,937	)		(1,830,530	)		1,999,855			28,612

Net cash (used) provided by financing activities		(249,064	)		(1,831,533	)		1,000,813			1,674,992			595,208

Net (decrease) increase in cash and cash equivalents		(5,293	)		101,633			2,459			4,936			103,735
Effect of Canadian exchange rate changes on cash and cash equivalents		5,293			712			19			(4,936	)		1,088
Cash and cash equivalents at beginning of period					421,450									421,450

Cash and cash equivalents at end of period	$			$	523,795		$	2,478		$			$	526,273

Item 2. MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

GENERAL

The Company is a consumer finance company specializing in purchasing retail automobile installment sales contracts originated by franchised and select independent dealers in connection with the sale of used and new automobiles. The Company generates revenue and cash flows primarily through the purchase, retention, subsequent securitization and servicing of finance receivables. As used herein, “loans” include auto finance receivables originated by dealers and purchased by the Company. To fund the acquisition of receivables prior to securitization and to fund the repurchase of receivables pursuant to cleanup call options, the Company uses available cash and borrowings under its warehouse credit facilities. The Company earns finance charge income on the finance receivables and pays interest expense on borrowings under its warehouse credit facilities.

The Company periodically transfers receivables to securitization Trusts (“Trusts”) that, in turn, sell asset-backed securities to investors. Prior to October 1, 2002, these securitization transactions were structured as sales of finance receivables. Receivables sold under this structure are referred to herein as “gain on sale receivables.” At September 30, 2005, approximately 14% of the Company’s managed receivables were gain on sale receivables. The Company retains an interest in the securitization transactions in the form of credit enhancement assets, representing the estimated future excess cash flows expected to be received by the Company over the life of the securitization. Excess cash flows result from the difference between the finance charges received from the obligors on the receivables and the interest paid to investors in the asset-backed securities, net of credit losses and expenses.

Excess cash flows from the Trusts are initially utilized to fund credit enhancement requirements in order to attain specific credit ratings for the asset-backed securities issued by the Trusts. Once predetermined credit enhancement requirements are reached and maintained, excess cash flows are distributed to the Company. Credit enhancement requirements will increase if targeted portfolio performance ratios are exceeded (see Liquidity and Capital Resources section). In addition to excess cash flows, the Company receives monthly base servicing income of 2.25% per annum on the outstanding principal balance of domestic receivables securitized and collects other fees, such as late charges, as servicer for securitization Trusts.

The Company changed the structure of its securitization transactions beginning with transactions closed subsequent to September 30, 2002, to no longer meet the accounting criteria for sales of finance receivables. Accordingly, following a securitization, the finance receivables and the related securitization notes payable remain on the consolidated balance sheets. The Company recognizes finance charge and fee income on the receivables and interest expense on the securities issued in the securitization transaction, and records a provision for loan losses to cover probable loan losses on the receivables.

RECENT DEVELOPMENTS

On November 7, 2005, the Company announced a definitive agreement for its operating subsidiary, AmeriCredit Financial Services, Inc., to acquire all of the outstanding capital stock of Bay View Acceptance Corporation (“BVAC”). BVAC is the auto finance subsidiary of Bay View Capital Corporation. The acquisition is an all-cash transaction that values BVAC at $62.5 million which was approximately book-value at June 30, 2005.

BVAC acquires retail auto installment contracts from auto dealers in 32 states offering specialized products, including extended term financing and larger advances, to customers with prime credit scores. As of June 30, 2005, it had approximately 33,000 customers and $684 million in managed auto receivables.

CRITICAL ACCOUNTING ESTIMATES

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions which affect the reported amounts of assets and liabilities and the disclosures of contingent assets and liabilities as of the date of the financial statements and the amount of revenue and costs and expenses during the reporting periods. Actual results could differ from those estimates and those differences may be material. The accounting estimates that the Company believes are the most critical to understanding and evaluating the Company’s reported financial results include the following:

Allowance for loan losses

The allowance for loan losses is established systematically based on the determination of the amount of probable credit losses inherent in the finance receivables as of the reporting date. The Company reviews charge-off experience factors, delinquency reports, historical collection rates, estimates of the value of the underlying collateral, economic trends, such as unemployment rates, and other information in order to make the necessary judgments as to probable credit losses. The Company also uses historical charge-off experience to determine a loss confirmation period, which is defined as the time between when an event, such as delinquency status, giving rise to a probable credit loss occurs with respect to a specific account and when such account is charged off. This loss confirmation period is applied to the forecasted probable credit losses to determine the amount of losses inherent in finance receivables at the reporting date. Assumptions regarding credit losses and loss confirmation periods are reviewed periodically and may be impacted by actual performance of finance receivables and changes in any of the factors discussed above. Should the credit loss assumption or loss confirmation period increase, there could be an increase in the amount of allowance for loan losses required, which could decrease the net carrying value of finance receivables and increase the amount of provision for loan

losses recorded on the consolidated statements of income. A 10% and 20% increase in cumulative net credit losses over the loss confirmation period would increase the allowance for loan losses as of September 30, 2005, as follows (in thousands):


	10% adverse change		20% adverse change
Impact on allowance for loan losses	$	60,549	$	121,099

The Company believes that the allowance for loan losses is adequate to cover probable losses inherent in its receivables; however, because the allowance for loan losses is based on estimates, there can be no assurance that the ultimate charge-off amount will not exceed such estimates or that the Company’s credit loss assumptions will not increase.

Credit Enhancement Assets

The Company’s credit enhancement assets, which represent retained interests in securitization Trusts accounted for as sales, are recorded at fair value. Because market prices are not readily available for the credit enhancement assets, fair value is determined using discounted cash flow models. The most significant assumptions made are the cumulative net credit losses to be incurred on the pool of receivables sold, the timing of those losses and the rate at which estimated future excess cash flows are discounted. The assumptions used represent the Company’s best estimates. The assumptions may change in future periods due to changes in the economy that may impact the performance of the Company’s finance receivables and the risk profiles of its credit enhancement assets. The use of different assumptions would result in different carrying values for the Company’s credit enhancement assets and may change the amount of accretion of present value discount and impairment of credit enhancement assets recognized through the consolidated statements of income. An immediate 10% and 20% adverse change in the assumptions used to measure the fair value of credit enhancement assets would decrease the credit enhancement assets as of September 30, 2005, as follows (in thousands):


Impact on fair value of	10% adverse change		20% adverse change
Expected cumulative net credit losses	$	5,877	$	11,624
Discount rate		1,998		3,981

The adverse changes to the key assumptions and estimates are hypothetical. The change in fair value based on the above variations in assumptions cannot be extrapolated because the relationship of the change in assumption to the change in fair value may not be linear. Also, in this table, the effect of a variation in a particular assumption on fair value is calculated independently from any change in another assumption. In reality, changes in one factor may contribute to changes in another, which might magnify or counteract the sensitivities. Furthermore, due to potential changes in current economic conditions, the estimated fair values as disclosed should not be considered

indicative of the future performance of these assets. The sensitivities do not reflect actions management might take to offset the impact of any adverse change.

Stock-based compensation

On July 1, 2003, the Company adopted the fair value recognition provision of SFAS 123, prospectively for all awards granted, modified or settled after June 30, 2003.

The assumptions used to estimate the fair value of options granted or modified are reviewed each time there is a new grant or modification of a previous grant and may be impacted by actual fluctuation in the Company’s stock price, movements in market interest rates and option terms. The use of different assumptions would produce a different fair value for the options granted or modified and would impact the amount of compensation expense recognized on the consolidated statements of income. The impact of a 10% or 20% adverse change in the Company’s assumptions of volatility, risk-free interest rate and expected life on the amount of compensation expense recognized would not have been material for the three months ended September 30, 2005 or 2004 since there were no stock-based compensation arrangements granted or modified during the three months ended September 30, 2005 and 2004.

RESULTS OF OPERATIONS

Three Months Ended September 30, 2005 as compared to Three Months Ended September 30, 2004

Changes in Finance Receivables:

A summary of changes in the Company’s finance receivables is as follows (in thousands):


	Three Months Ended September 30,
	2005			2004
Balance at beginning of period	$	8,838,968		$	6,782,280
Loans purchased		1,520,146			1,084,786
Loans repurchased from gain on sale Trusts		192,311			110,283
Liquidations and other		(1,088,542	)		(791,387	)

Balance at end of period	$	9,462,883		$	7,185,962

Average finance receivables	$	9,050,440		$	6,952,426

The increase in loans purchased during the three months ended September 30, 2005, as compared to the three months ended September 30, 2004, was due to the addition of staff in the Company’s branch office network and related areas in order to support new loan growth. The increase in liquidations and other resulted primarily from increased collections and charge-offs on finance receivables due to the increase in average finance receivables and average age, or seasoning, of the portfolio. As of September 30, 2005 and 2004, the Company operated 88 and 89 branch offices, respectively.

The average new loan size was $17,509 for the three months ended September 30, 2005, compared to $17,048 for the three months ended September 30, 2004. The average annual percentage rate for finance receivables purchased during the three months ended September 30, 2005, increased to 16.4% from 16.2% during the three months ended September 30, 2004, due to an increase in new loan pricing as a result of an increase in short term market interest rates.

Net Margin:

Net margin is the difference between finance charge and other income earned on the Company’s receivables and the cost to fund the receivables as well as the cost of debt incurred for general corporate purposes.

The Company’s net margin as reflected on the consolidated statements of income is as follows (in thousands):


	Three Months Ended September 30,
	2005			2004
Finance charge income	$	373,736		$	269,928
Other income		21,186			10,671
Interest expense		(90,271	)		(57,516	)

Net margin	$	304,651		$	223,083

Net margin as a percentage of average finance receivables is as follows:


	Three Months Ended September 30,
	2005		2004
Finance charge income	16.4	%	15.4	%
Other income	0.9		0.6
Interest expense	(3.9	)	(3.3	)

Net margin as a percentage of average finance receivables	13.4	%	12.7	%

Revenue:

Finance charge income increased by 38% to $373.7 million for the three months ended September 30, 2005, from $269.9 million for the three months ended September 30, 2004, due to the increase in average finance receivables and an increase in the Company’s effective yield. The Company’s effective yield on its finance receivables increased to 16.4% for the three months ended September 30, 2005, from 15.4% for the three months ended September 30, 2004. The effective yield represents finance charges and fees taken into earnings during the period as a percentage of average finance receivables and may be lower than the contractual rates of the Company’s finance contracts due to finance receivables in nonaccrual status. The increase in the effective yield is primarily due to the accretion of acquisition fees on loans acquired subsequent to June 30, 2004, due to the Company’s adoption of Statement of Position 03-3, “Accounting for Certain Loans on Debt Securities Acquired in a Transfer” (“SOP 03-3”).

Servicing income consists of the following (in thousands):


	Three Months Ended September 30,
	2005			2004
Servicing fees	$	14,135		$	32,322
Other-than-temporary impairment		(457	)		(91	)
Accretion		11,663			27,126

	$	25,341		$	59,357

Average gain on sale receivables	$	1,970,313		$	4,727,627

Servicing fees are earned from servicing domestic finance receivables sold to gain on sale Trusts. Servicing fees decreased as a result of the decrease in average gain on sale receivables caused by the change in the Company’s securitization transaction structure from gain on sale to secured financing. Servicing fees were 2.8% and 2.7%, annualized, of average gain on sale receivables for the three months ended September 30, 2005 and 2004, respectively.

Other-than-temporary impairment of $457,000 and $91,000 for the three months ended September 30, 2005 and 2004, respectively, resulted from higher than forecasted net losses in certain Trusts.

The present value discount related to the Company’s credit enhancement assets represents the risk-adjusted time value of money on estimated cash flows. The present value discount on credit enhancement assets is accreted into earnings over the life of the credit enhancement assets using the effective interest method. Additionally, unrealized gains on credit enhancement assets reflected in accumulated other comprehensive income are also accreted into earnings over the life of the credit enhancement assets using the effective interest method. The Company recognized accretion of $11.7 million, or 9.6%, on an annualized basis, of average credit enhancement assets, and $27.1 million, or 10.6%, on an annualized basis, of average credit enhancement assets, during the three months ended September 30, 2005 and 2004, respectively. The Company does not record accretion in a period when such accretion would cause an other-than-temporary impairment in a securitization pool. Accretion as a percentage of average credit enhancements was lower during the three months ended September 30, 2005, as compared to the three months ended September 30, 2004, as a result of more securitization transactions incurring other-than-temporary impairments.

Other income consists of the following (in thousands):


	Three Months Ended September 30,
	2005		2004
Investment income	$	12,118	$	3,110
Late fees and other income		9,068		7,561

	$	21,186	$	10,671

Investment income increased as a result of higher invested cash balances combined with increased market interest rates.

Costs and Expenses:

Operating expenses increased to $77.9 million for the three months ended September 30, 2005, from $74.0 million for the three months ended September 30, 2004, due to increased costs to support greater origination volume.

Provisions for loan losses are charged to income to bring the Company’s allowance for loan losses to a level which management considers adequate to absorb probable credit losses inherent in the portfolio of finance receivables. The provision for loan losses recorded for the three months ended September 30, 2005 and 2004, reflect inherent losses on receivables originated during those quarters and changes in the amount of inherent losses on receivables originated in prior periods. The provision for loan losses increased to $165.9 million for the three months ended September 30, 2005, from $98.7 million for the three months ended September 30, 2004, as a result of increased origination volume, charges related to Hurricane Katrina and higher overall reserve levels. As an annualized percentage of average finance receivables, the provision for loan losses was 7.3% and 5.6% for the three months ended September 30, 2005 and 2004, respectively. The provision for loan losses as a percentage of average finance receivables was higher for the three months ended September 30, 2005, because of two factors: first, the impact of Hurricane Katrina; and second, an increase in estimated losses inherent in the portfolio. In August 2005 Hurricane Katrina struck the Gulf Coast causing extensive damage. Collateral supporting finance receivables in certain parts of Alabama, Louisiana and Mississippi was damaged or destroyed by the storm. Additionally, job displacement and transition issues related to the disaster caused a rise in inherent losses on finance receivables in areas affected by the storm. The Company recorded a $10.0 million (0.4%, as an annualized percentage of average finance receivables) provision for loan losses during the three months ended September 30, 2005, for the estimated impact of the storm. The Company also raised its estimate of losses inherent in the portfolio at September 30, 2005, in light of current economic factors. This increase in probable credit losses resulted in higher provision for loan losses during the three months ended September 30, 2005. As a result of the higher provision for loan losses, the combined nonaccretable acquisition fees and allowance for loan losses against finance receivables increased to 6.4% as of September 30, 2005, from 6.1% as of June 30, 2005.

Interest expense increased to $90.3 million for the three months ended September 30, 2005, from $57.5 million for the three months ended September 30, 2004. Average debt outstanding was $8,458.5 million and $6,382.5 million for the three months ended September 30, 2005 and 2004, respectively. The Company’s effective rate of interest paid on its debt increased to 4.2% for the three months ended September 30, 2005, compared to 3.6% for the three months ended September 30, 2004, due to an increase in market interest rates.

The Company’s effective income tax rate was 37.2% and 37.0% for the three months ended September 30, 2005 and 2004, respectively.

Other Comprehensive Income (Loss):

Other comprehensive income (loss) consisted of the following (in thousands):


	Three Months Ended September 30,
	2005			2004
Unrealized losses on credit enhancement assets	$	(4,008	)	$	(13,503	)
Unrealized gains (losses) on cash flow hedges		8,206			(2,098	)
Canadian currency translation adjustment		4,991			5,293
Income tax (provision) benefit		(1,562	)		6,027

	$	7,627		$	(4,281	)

Credit Enhancement Assets

Unrealized losses on credit enhancement assets consisted of the following (in thousands):


	Three Months Ended September 30,
	2005			2004
Unrealized losses related to changes in credit loss assumptions	$	(1,811	)	$	(5,509	)
Unrealized gains (losses) related to changes in interest rates		453			(2,498	)
Reclassification of unrealized gains into earnings through accretion		(2,650	)		(5,496	)

	$	(4,008	)	$	(13,503	)

Changes in the fair value of credit enhancement assets as a result of modifications to the credit loss assumptions are reported as unrealized gains in other comprehensive income (loss) until realized. Unrealized losses are reported as a reduction in unrealized gains to the extent that there are unrealized gains. If there are no unrealized gains to offset the unrealized losses, the losses are considered to be other-than-temporary and are charged

to operations. The cumulative credit loss assumptions used to estimate the fair value of credit enhancement assets are periodically reviewed by the Company and modified to reflect the actual credit performance for each securitization pool through the reporting date as well as estimates of future losses considering several factors including changes in the general economy. Differences between cumulative credit loss assumptions used in individual securitization pools can be attributed to the original credit attributes of a pool, actual credit performance through the reporting date and pool seasoning to the extent that changes in economic trends will have more of an impact on the expected future performance of less seasoned pools.

The Company increased the cumulative credit loss assumptions used in measuring the fair value of credit enhancement assets to a range of 12.6% to 14.9% as of September 30, 2005, from a range of 12.4% to 14.8% as of June 30, 2005. For the three months ended September 30, 2005, on a Trust by Trust basis, certain Trusts experienced worse than expected credit performance and increased cumulative credit loss assumptions that resulted in the recognition of unrealized losses of $1.8 million and, for certain trusts, other-than-temporary impairment of $457,000. The Company increased the cumulative credit loss assumptions used in measuring the fair value of credit enhancement assets to a range of 12.6% to 15.2% as of September 30, 2004, from a range of 12.4% to 14.9% as of June 30, 2004. For the three months ended September 30, 2004, on a Trust by Trust basis, certain Trusts experienced worse than expected credit performance and increased cumulative credit loss assumptions that resulted in the recognition of unrealized losses of $5.5 million and, for certain trusts, other-than-temporary impairment of $91,000.

Unrealized gains related to changes in interest rates of $453,000 for the three months ended September 30, 2005, resulted primarily from an increase in estimated future cash flows to be generated from investment income earned on the restricted cash and Trust collection accounts due to an increase in forward interest rate expectations. Unrealized losses related to changes in interest rates of $2.5 million for the three months ended September 30, 2004, resulted primarily from a decline in estimated future cash flows to be generated from investment income earned on the restricted cash and Trust collections accounts due to a decrease in forward interest rate expectations.

Net unrealized gains of $2.7 million and $5.5 million were reclassified into earnings through accretion during the three months ended September 30, 2005 and 2004, respectively.

Cash Flow Hedges

Unrealized gains (losses) on cash flow hedges consisted of the following (in thousands):


	Three Months Ended September 30,
	2005			2004
Unrealized gain related to changes in fair value	$	8,484		$	1,025
Reclassification of net unrealized gains into earnings		(278	)		(3,123	)

	$	8,206		$	(2,098	)

Unrealized gains related to changes in fair value for the three months ended September 30, 2005 and 2004, were primarily due to changes in the fair value of interest rate swap agreements that were designated as cash flow hedges for accounting purposes. The fair value of the interest rate swap agreements fluctuates based upon changes in forward interest rate expectations.

Unrealized gains or losses on cash flow hedges of the Company’s credit enhancement assets are reclassified into earnings when unrealized gains or losses related to interest rate fluctuations on the Company’s credit enhancement assets are reclassified. However, if the Company expects that the continued reporting of a loss in accumulated other comprehensive income would lead to recognizing a net loss on the combination of the interest rate swap agreements and the credit enhancement assets, the loss is reclassified to earnings for the amount that is not expected to be recovered. Unrealized gains or losses on cash flow hedges of the Company’s floating rate debt are reclassified into earnings when interest rate fluctuations on securitization notes payable or other hedged items affect earnings.

Canadian Currency Translation Adjustment

Canadian currency translation adjustment gains of $5.0 million and losses of $5.3 million for the three months ended September 30, 2005 and 2004, respectively, were included in other comprehensive income (loss). The translation adjustment is due to the change in the value of the Company’s Canadian dollar denominated assets related to the change in the U.S. dollar to Canadian dollar conversion rates during the three months ended September 30, 2005 and 2004. The Company does not anticipate the settlement of intercompany transactions with its Canadian subsidiaries in the foreseeable future.

CREDIT QUALITY

The Company provides financing in relatively high-risk markets, and, therefore, anticipates a corresponding high level of delinquencies and charge-offs.

Finance receivables on the Company’s balance sheets include receivables purchased but not yet securitized and receivables securitized by the Company after September 30, 2002. Provisions for loan losses are charged to operations in amounts sufficient to maintain the allowance for loan losses on the balance sheet at a level considered adequate to cover probable credit losses inherent in finance receivables.

Prior to October 1, 2002, the Company periodically sold receivables to Trusts in securitization transactions accounted for as a sale of receivables and retained an interest in the receivables sold in the form of credit enhancement assets. Credit enhancement assets are reflected on the Company’s balance sheets at estimated fair value, calculated based upon the present value of estimated excess future cash flows from the Trusts using, among other assumptions, estimates of future credit losses on the receivables sold. Receivables sold to Trusts that are subsequently charged off decrease the amount of excess future cash flows from the Trusts. If such charge-offs are expected to exceed the Company’s estimates of cumulative credit losses or if the actual timing of these losses differs from expected timing, the fair value of credit enhancement assets is written down through an other-than-temporary impairment charge to earnings to the extent the write-down exceeds any previously recorded unrealized gain.

The following tables present certain data related to the receivables portfolio (dollars in thousands):


	September 30, 2005
	Finance Receivables			Gain on Sale		Total Managed
Principal amount of receivables, net of fees	$	9,462,883		$	1,590,943	$	11,053,826

Nonaccretable acquisition fees		(203,687	)
Allowance for loan losses		(401,807	)

Receivables, net	$	8,857,389

Number of outstanding contracts		742,413			190,330		932,743

Average carrying amount of outstanding contract (in dollars)	$	12,746		$	8,359	$	11,851

Allowance for loan losses and nonaccretable acquisition fees as a percentage of receivables		6.4	%


	June 30, 2005
	Finance Receivables			Gain on Sale		Total Managed
Principal amount of receivables, net of fees	$	8,838,968		$	2,163,941	$	11,002,909

Nonaccretable acquisition fees		(199,810	)
Allowance for loan losses		(341,408	)

Receivables, net	$	8,297,750

Number of outstanding contracts		692,946			247,634		940,580

Average carrying amount of outstanding contract (in dollars)	$	12,756		$	8,738	$	11,698

Allowance for loan losses and nonaccretable acquisition fees as a percentage of receivables		6.1	%

The allowance for loan losses and nonaccretable acquisition fees increased to $605.5 million, or 6.4% of finance receivables, at September 30, 2005, from $541.2 million, or 6.1% of finance receivables, at June 30, 2005. The allowance for loan losses and nonaccretable acquisition fees increased as a result of higher finance receivables, charges related to Hurricane Katrina and overall higher reserve levels in light of current economic factors.

Delinquency

The following is a summary of managed finance receivables that are (i) more than 30 days delinquent, but not yet in repossession, and (ii) in repossession, but not yet charged off (dollars in thousands):


	September 30, 2005
	Finance Receivables				Gain on Sale				Total Managed
	Amount		Percent		Amount		Percent		Amount		Percent
Delinquent contracts:
31 to 60 days	$	499,643	5.3	%	$	160,685	10.1	%	$	660,328	6.0	%
Greater than 60 days		209,599	2.2			76,548	4.8			286,147	2.6

		709,242	7.5			237,233	14.9			946,475	8.6
In repossession		33,911	0.4			10,157	0.6			44,068	0.4

	$	743,153	7.9	%	$	247,390	15.5	%	$	990,543	9.0	%


	September 30, 2004
	Finance Receivables				Gain on Sale				Total Managed
	Amount		Percent		Amount		Percent		Amount		Percent
Delinquent contracts:
31 to 60 days	$	337,415	4.7	%	$	416,312	9.7	%	$	753,727	6.6	%
Greater than 60 days		135,332	1.9			174,683	4.1			310,015	2.7

		472,747	6.6			590,995	13.8			1,063,742	9.3
In repossession		23,476	0.3			27,509	0.6			50,985	0.4

	$	496,223	6.9	%	$	618,504	14.4	%	$	1,114,727	9.7	%

An account is considered delinquent if a substantial portion of a scheduled payment has not been received by the date such payment was contractually due. Delinquencies in the Company’s managed receivables portfolio may vary from period to period based upon the average age or seasoning of the portfolio, seasonality within the calendar year and economic factors. Due to the Company’s target customer base, a relatively high percentage of accounts become delinquent at some point in the life of a loan and there is a high rate of account movement between current and delinquent status in the portfolio.

The Company has experienced improved credit performance on loans originated since February 2003 as result of tightened credit standards in connection with implementation of a revised operating plan. A greater percentage of total managed finance receivables at September 30, 2005, as compared to that same percentage at September 30, 2004, were originated since February 2003. Accordingly, total managed finance receivables 31 to 60 days and greater-than-60 days delinquent were lower at September 30, 2005, as compared to September 30, 2004. Delinquencies in finance receivables are lower than delinquencies in gain on sale receivables due to improved credit performance on loans originated since February 2003 as well as the relative lower overall seasoning of such finance receivables. Delinquencies in finance receivables were higher at September 30, 2005, as compared to September 30, 2004, as a result of seasoning of the finance receivables.

Deferrals

In accordance with its policies and guidelines, the Company, at times, offers payment deferrals to consumers, whereby the consumer is allowed to move up to two delinquent payments to the end of the loan generally by paying a fee (approximately the interest portion of the payment deferred, except where state law provides for a lesser amount). The Company’s policies and guidelines, as well as certain contractual restrictions in the Company’s warehouse credit facilities and securitization transactions, limit the number and frequency of deferments that may be granted. The Company’s policies and guidelines generally limit the granting of deferments on new accounts until a requisite number of payments have been received. Due to the nature of the Company’s customer base and policies and guidelines of the deferral program, approximately 50% of accounts currently comprising the managed portfolio will receive a deferral at some point in the life of the account.

An account for which all delinquent payments are deferred is classified as current at the time the deferment is granted and therefore is not included as a delinquent account. Thereafter, such account is aged based on the timely payment of future installments in the same manner as any other account.

Contracts receiving a payment deferral as an average quarterly percentage of average managed receivables outstanding were as follows:


	Three Months Ended September 30,
	2005		2004
Finance receivables (as a percentage of average finance receivables)	6.4	%	4.7	%

Gain on sale receivables (as a percentage of average gain on sale receivables)	10.7	%	9.6	%

Total managed portfolio (as a percentage of average managed receivables)	7.2	%	6.7	%

The percentage of loans deferred is greater for the Company’s gain on sale receivables as compared to its finance receivables as a result of seasoning of the gain on sale receivables as well as overall improved credit performance on loans originated since February 2003. During the three months ended September 30, 2005, contracts receiving a deferral as a quarterly percentage of average managed receivables increased due to the effect of deferrals granted relating to the impact of Hurricane Katrina, which increased the quarterly percentage of deferments granted by 0.6% to 7.2% overall (6.6% excluding Hurricane Katrina related deferments).

The following is a summary of deferrals as a percentage of receivables outstanding:


	September 30, 2005
	Finance Receivables		Gain on Sale		Total Managed
Never deferred	81.4	%	30.4	%	74.1	%
Deferred:
1-2 times	15.8		45.1		20.0
3-4 times	2.6		24.3		5.7
Greater than 4 times	0.2		0.2		0.2

Total deferred	18.6		69.6		25.9

Total	100.0	%	100.0	%	100.0	%


	June 30, 2005
	Finance Receivables		Gain on Sale		Total Managed
Never deferred	82.5	%	38.1	%	73.8	%
Deferred:
1-2 times	15.0		42.6		20.4
3-4 times	2.3		19.1		5.6
Greater than 4 times	0.2		0.2		0.2

Total deferred	17.5		61.9		26.2

Total	100.0	%	100.0	%	100.0	%

The Company evaluates the results of its deferment strategies based upon the amount of cash installments that are collected on accounts after they have been deferred versus the extent to which the collateral underlying the deferred accounts has depreciated over the same period of time. Based on this evaluation, the Company believes that payment deferrals granted according to its policies and guidelines are an effective portfolio management technique and result in higher ultimate cash collections from the portfolio.

Changes in deferment levels do not have a direct impact on the ultimate amount of finance receivables charged off by the Company. However, the timing of a charge-off may be affected if the previously deferred account ultimately results in a charge-off. To the extent that deferrals impact the ultimate timing of when an account is charged off, historical charge-off ratios and loss confirmation periods used in the determination of the adequacy of the Company’s allowance for loan losses are also impacted. Increased use of deferrals may result in a lengthening of the loss confirmation period, which would increase expectations of credit losses inherent in the loan portfolio and therefore increase the allowance for loan losses and related provision for loan losses. Changes in these ratios and periods are considered in determining the appropriate level of allowance for loan losses and related provision for loan losses.

Charge-offs

The following table presents charge-off data with respect to the Company’s managed finance receivables portfolio (dollars in thousands):


	Three Months Ended September 30,
	2005			2004
Finance receivables:
Repossession charge-offs	$	157,697		$	111,809
Less: Recoveries		(75,082	)		(50,708	)
Mandatory charge-offs (a)		26,558			13,880

Net charge-offs	$	109,173		$	74,981

Gain on sale:
Repossession charge-offs	$	72,384		$	162,368
Less: Recoveries		(28,859	)		(60,507	)
Mandatory charge-offs (a)		4,457			9,451

Net charge-offs	$	47,982		$	111,312

Total managed:
Repossession charge-offs	$	230,081		$	274,177
Less: Recoveries		(103,941	)		(111,215	)
Mandatory charge-offs (a)		31,015			23,331

Net charge-offs	$	157,155		$	186,293

Net charge-offs as an annualized percentage of average receivables:
Finance receivables		4.8	%		4.3	%

Gain on sale receivables		9.7	%		9.3	%

Total managed portfolio		5.7	%		6.3	%

Recoveries as a percentage of gross repossession charge-offs:
Finance receivables		47.6	%		45.4	%

Gain on sale receivables		39.9	%		37.3	%

Total managed portfolio		45.2	%		40.6	%

(a)

Mandatory charge-offs represent accounts 120 days delinquent that are charged-off in full with no recovery amounts realized at time of charge-off and the change during the period in the aggregate write-down of finance receivables in repossession to the net realizable value of the repossessed vehicle when the repossessed vehicle is legally available for sale.

Net charge-offs as an annualized percentage of average managed receivables outstanding may vary from period to period based upon the average age or seasoning of the portfolio and economic factors. The decrease in net charge-offs for the three months ended September 30, 2005, as compared to the three months ended September 30, 2004, resulted primarily from improved credit performance on loans originated since February 2003 combined with an overall improvement in recovery rates.

LIQUIDITY AND CAPITAL RESOURCES

General

The Company’s primary sources of cash are finance charge income, servicing fees, distributions from securitization Trusts, borrowings under warehouse credit facilities, transfers of finance receivables to Trusts in securitization transactions and collections and recoveries on finance receivables. The Company’s primary uses of cash have been purchases of finance receivables, repayment of warehouse credit facilities and securitization notes payable, funding credit enhancement requirements for securitization transactions, operating expenses, income taxes and stock repurchases.

The Company used cash of $1,621.9 million and $1,178.4 million for the purchase of finance receivables during the three months ended September 30, 2005 and 2004, respectively. These purchases were funded initially utilizing cash and warehouse credit facilities and subsequently through long-term financing in securitization transactions.

Warehouse Credit Facilities

In the normal course of business, in addition to using its available cash, the Company pledges receivables and borrows under its warehouse credit facilities to fund its operations and repays these borrowings as appropriate under its cash management strategy.

As of September 30, 2005, warehouse credit facilities consisted of the following (in millions):


Facility Type	Maturity	Facility Amount		Advances Outstanding
Commercial paper	November 2007 (a)(b)	$	1,950.0	$	31.6
Medium term note	October 2007 (a)(c)		650.0		650.0
Repurchase facility	August 2006 (a)		500.0		230.2
Near prime facility	July 2006 (a)		400.0		192.9

		$	3,500.0	$	1,104.7

(a)

At the maturity date, the outstanding debt balance can either be repaid in full or over time based on the amortization of receivables pledged.

(b)

$150.0 million of this facility matures in November 2005, and the remaining $1,800.0 million matures in November 2007.

(c)

This facility is a revolving facility through the date stated above. During the revolving period, the Company has the ability to substitute receivables for cash, or vice versa.

The Company’s warehouse credit facilities contain various covenants requiring certain minimum financial ratios, asset quality, and portfolio performance ratios (cumulative net loss, delinquency and repossession ratios) as well as limits on deferment levels. Failure to meet any of these covenants could result in an event of default under these agreements. If an event of default occurs under these agreements, the lenders could elect to declare all amounts outstanding under these agreements to be immediately due and payable, enforce their interests against collateral pledged under these agreements or restrict the Company’s ability to obtain additional borrowings under these agreements. As of September 30, 2005, the Company’s warehouse credit facilities were in compliance with all covenants.

Securitizations

The Company has completed 50 securitization transactions through September 30, 2005. The proceeds from the transactions were primarily used to repay borrowings outstanding under the Company’s warehouse credit facilities.

A summary of the active transactions^(a) is as follows (in millions):


Transaction	Date	Original Amount		Balance at September 30, 2005
Gain on sale:
2001-C	September 2001	$	1,600.0	$	179.3
2001-D	October 2001		1,800.0		213.7
2002-A	February 2002		1,600.0		237.2
2002-1	April 2002		990.0		123.9
2002-A Canada (b)	May 2002		145.0		23.2
2002-B	June 2002		1,200.0		209.0
2002-C	August 2002		1,300.0		251.8
2002-D	September 2002		600.0		126.3

Total gain on sale transactions			9,235.0		1,364.4

Secured financing:
2002-E-M	October 2002		1,700.0		417.7
C2002-1 Canada (b)(c)	November 2002		137.0		20.5
2003-A-M	April 2003		1,000.0		282.7
2003-B-X	May 2003		825.0		248.8
2003-C-F	September 2003		915.0		301.2
2003-D-M	October 2003		1,200.0		449.5
2004-A-F	February 2004		750.0		307.8
2004-B-M	April 2004		900.0		415.9
2004-1 (d)	June 2004		575.0		295.6
2004-C-A	August 2004		800.0		495.6
2004-D-F	November 2004		750.0		512.1
2005-A-X	February 2005		900.0		673.3
2005-1	April 2005		750.0		629.4
2005-B-M	June 2005		1,350.0		1,227.5
2005-C-F	August 2005		1,100.0		1,100.0

Total secured financing transactions			13,652.0		7,377.6

Total active securitizations			$22,887.0	$	8,742.0

(a)

Transactions originally totaling $16,779.5 million have been paid off as of September 30, 2005.

(b)

Balances at September 30, 2005, reflect fluctuations in foreign currency translation rates and principal paydowns.

(c)

Amounts do not include $25.7 million of asset-backed securities issued and retained by the Company.

(d)

Amounts do not include $7.4 million of asset-backed securities retained by the Company.

Prior to October 1, 2002, the Company structured its securitization transactions to meet the accounting criteria for sales of finance receivables under generally accepted accounting principles in the United States of America. The Company changed the structure of securitization transactions completed subsequent to September 30, 2002, to no longer meet the accounting criteria for sale of finance receivables. Accordingly, following a securitization, the finance receivables are transferred to a securitization Trust, which is a special purpose finance subsidiary of AmeriCredit Corp. The related securitization notes payable issued by these Trusts remain on the Company’s consolidated balance sheets. While these Trusts are included in the Company’s consolidated financial statements, these Trusts are separate legal entities; thus the finance receivables and other assets held by these Trusts are legally owned by these Trusts, are available to satisfy the related securitization notes payable and are not available to creditors of AmeriCredit Corp. or its other subsidiaries. This change in securitization structure does not change the Company’s requirement to provide credit enhancement in order to attain specific credit ratings for the asset-backed securities issued by the Trusts. The Company typically makes an initial deposit to a restricted cash account and transfers finance receivables in excess of the amount of asset-backed securities issued to create initial overcollateralization. The Company subsequently uses excess cash flows generated by the Trusts to either increase the restricted cash account or repay the outstanding asset-backed securities on an accelerated basis, thereby creating additional credit enhancement through overcollateralization in the Trusts. When the credit enhancement levels reach specified percentages of the Trust’s pool of receivables, excess cash flows are distributed to the Company.

The Company employs two types of securitization structures to meet its credit enhancement requirements. The structure the Company has utilized most frequently involves the purchase of a financial guaranty policy issued by an insurer to cover the asset-backed securities and may include the use of reinsurance and other alternative credit enhancement products to reduce the required initial deposit to the restricted cash account and initial overcollateralization. However, the Company currently has no outstanding commitments to obtain reinsurance or other alternative credit enhancement products and will likely provide initial credit enhancement deposits in future securitization transactions from its existing capital resources.

The Company’s second type of securitization structure involves the sale of subordinated asset-backed securities in order to provide credit enhancement for the senior asset-backed securities. The subordinated asset-backed securities replace a portion of the Company’s credit enhancement required in a securitization transaction in a manner similar to the utilization of insurance or other alternative credit enhancements described in the preceding paragraph.

The Company’s most recent securitization transaction completed in August 2005 covered by a financial guaranty insurance policy required an initial cash deposit and overcollateralization level of 9.5% of the original receivable pool balance; and target credit enhancement levels must reach 15.5% of the receivable pool balance before cash is distributed to the Company. Under this

structure, the Company typically expects to begin to receive cash distributions approximately five to eight months after receivables are securitized. Securitization transactions covered by financial guaranty insurance policies completed since the beginning of calendar year 2003 and until the most recent transaction had initial cash deposits and overcollateralization levels between 9.5% and 12.0% and contained target credit enhancement levels of 17.0% to 18.5%. Increases or decreases to the credit enhancement level on future securitization transactions will depend on the net interest margin, credit performance trends of the Company’s finance receivables, the Company’s financial condition and the economic environment.

Cash flows related to securitization transactions were as follows (in millions):


	Three Months Ended September 30,
	2005		2004
Initial credit enhancement deposits:
Secured financing Trusts:
Restricted cash	$	23.8	$	17.5
Overcollateralization		89.2		74.3
Distributions from Trusts, net of swap payments:
Gain on sale Trusts		143.0		100.3
Secured financing Trusts		153.1		150.7

With respect to the Company’s securitization transactions covered by a financial guaranty insurance policy, agreements with the insurers provide that if portfolio performance ratios (delinquency, cumulative default or cumulative net loss triggers) in a Trust’s pool of receivables exceed certain targets, the specified credit enhancement levels would be increased.

Prior to October 2002, the financial guaranty insurance policies for all of the Company’s insured securitization transactions were provided by Financial Security Assurance, Inc. (“FSA”) and are referred to herein as the “FSA Program.” The restricted cash account for each securitization Trust insured as part of the FSA Program was cross-collateralized to the restricted cash accounts established in connection with the Company’s other securitization Trusts in the FSA Program, such that excess cash flows from an FSA Program securitization that had already met its own credit enhancement requirement could be used to fund target credit enhancement requirements with respect to FSA Program securitizations in which specified portfolio performance ratios had been exceeded, rather than being distributed to the Company.

The Company’s securitization transactions insured by financial guaranty insurance providers, including FSA, since October 2002, are cross-collateralized to a more limited extent. In the event of a shortfall in the original target credit enhancement requirement for any of these securitization Trusts, excess cash flows from other transactions insured by the same insurance provider would be used to satisfy the shortfall amount. In one of

the Company’s securitization transactions, if a secured party receives a notice of a rating agency review for downgrade or if there is a downgrade of any class of notes (without taking into consideration the presence of the financial guaranty insurance policy) excess cash flows from other securitization transactions insured by the same insurance provider would be utilized to satisfy any increased target credit enhancement requirements.

As of September 30, 2005, the Company had exceeded its targeted cumulative net loss triggers in the six remaining FSA Program securitizations. FSA has not waived the trigger violation with respect to five of these securitizations, and accordingly, cash of approximately $73.7 million generated by FSA Program securitizations otherwise distributable to the Company was used to fund increased credit enhancement levels for the securitizations that breached their cumulative net loss triggers. The higher targeted credit enhancement levels have been reached and maintained in each of these five FSA Program securitizations. In one FSA Program securitization in which the cumulative net loss trigger was previously breached, FSA has granted waivers through October 2005. However, the Company cannot guarantee that FSA will continue to grant a waiver; if a waiver had not been granted, the credit enhancement level for such securitization would have increased by $15.1 million as of October 31, 2005. The impact of any delay in the amount of cash to be released to the Company during fiscal 2006 is not expected to be material to the Company’s liquidity position.

The agreements that the Company enters into with its financial guaranty insurance providers in connection with securitization transactions contain additional specified targeted portfolio performance ratios (delinquency, cumulative default and cumulative net loss triggers) that are higher than the limits referred to above. If, at any measurement date, the targeted portfolio performance ratios with respect to any insured Trust were to exceed these additional levels, provisions of the agreements permit the financial guaranty insurance providers to terminate the Company’s servicing rights to the receivables sold to that Trust. In addition, the servicing agreements on certain insured securitization Trusts are cross-defaulted so that a default under one servicing agreement would allow the financial guaranty insurance provider to terminate the Company’s servicing rights under all servicing agreements for securitization Trusts in which they issued a financial guaranty insurance policy. Additionally, if these higher targeted portfolio performance levels were exceeded, the financial guaranty insurance providers may elect to retain all excess cash generated by other securitization transactions insured by them as additional credit enhancement. This, in turn, could result in defaults under the Company’s other securitizations and other material indebtedness. Although the Company has never exceeded these additional targeted portfolio performance ratios, and does not anticipate violating any event of default triggers for its securitizations, there can be no assurance that the Company’s servicing rights with respect to the automobile receivables in such Trusts or any other Trusts will not be terminated if (i) such targeted portfolio performance ratios are breached, (ii) the Company breaches its obligations under the servicing agreements, (iii) the financial guaranty insurance providers are required to make payments

under a policy, or (iv) certain bankruptcy or insolvency events were to occur. As of September 30, 2005, no such termination events have occurred with respect to any of the Trusts formed by the Company.

Stock Repurchases

Operating Plan

The Company believes that it has sufficient liquidity to achieve its growth strategies. As of September 30, 2005, the Company had unrestricted cash balances of $692.5 million. Assuming that origination volume ranges from $5.8 billion to $6.2 billion during the next twelve months and the initial credit enhancement requirement for the Company’s securitization transactions remains at 9.5% (the level for the most recent securitization completed in August 2005), the Company would require $551.0 million to $589.0 million in cash or liquidity to fund initial credit enhancement over that period. The Company expects that cash distributions from its securitization transactions will exceed the funding requirement for initial credit enhancement deposits during the next twelve months. The Company will continue to require the execution of additional securitization transactions during the next twelve months. There can be no assurance that funding will be available to the Company through the execution of securitization transactions or, if available, that the funding will be on acceptable terms. If the Company is unable to execute securitization transactions on a regular basis, and is otherwise unable to issue any other debt or equity, it would not have sufficient funds to finance new loan originations and, in such event, the Company would be required to revise the scale of its business, including possible discontinuation of loan origination activities, which would have a material adverse effect on the Company’s ability to achieve its business and financial objectives.

OFF-BALANCE SHEET ARRANGEMENTS

Prior to October 1, 2002, the Company structured its securitization transactions to meet the accounting criteria for sales of finance receivables. Under this structure, notes issued by the Company’s unconsolidated qualified special purpose finance subsidiaries are not recorded as liabilities on the Company’s consolidated balance sheets. See Liquidity and Capital Resources – Securitization for a detailed discussion of the Company’s securitization transactions.

INTEREST RATE RISK

Fluctuations in market interest rates impact the Company’s warehouse credit facilities and securitization transactions. The Company’s gross interest rate spread, which is the difference between interest earned on its finance receivables and interest paid, is affected by changes in interest rates as a result of the Company’s dependence upon the issuance of variable rate securities and the incurrence of variable rate debt to fund its purchases of finance receivables.

Warehouse Credit Facilities

Finance receivables purchased by the Company and pledged to secure borrowings under its warehouse credit facilities bear fixed interest rates. Amounts borrowed under the Company’s warehouse credit facilities bear interest at variable rates that are subject to frequent adjustments to reflect prevailing market interest rates. To protect the interest rate spread within each warehouse credit facility, the Company’s special purpose finance subsidiaries are contractually required to purchase interest rate cap agreements in connection with borrowings under the Company’s warehouse credit facilities. The purchaser of the interest rate cap agreement pays a premium in return for the right to receive the difference in the interest cost at any time a specified index of market interest rates rises above the stipulated “cap” rate. The purchaser of the interest rate cap agreement bears no obligation or liability if interest rates fall below the “cap” rate. As part of the Company’s interest rate risk management strategy and when economically feasible, the Company may simultaneously sell a corresponding interest rate cap agreement in order to offset the premium paid by its special purpose finance subsidiary to purchase the interest rate cap agreement and thus retain the interest rate risk. The fair value of the interest rate cap agreement purchased by the special purpose finance subsidiaries are included in other assets and the fair value of the interest rate cap agreement sold by the Company is included in other liabilities on the Company’s consolidated balance sheets.

In January 2005, the Company entered into interest rate swap agreements to hedge the variability in interest payments on its medium term notes facility caused by fluctuations in the benchmark interest rate. These interest rate swap agreements are designated and qualify as cash flow hedges. The fair values of the interest rate swap agreements are included in other assets on the consolidated balance sheets.

Securitizations

The interest rate demanded by investors in the Company’s securitization transactions depends on prevailing market interest rates for comparable transactions and the general interest rate environment. The Company utilizes

several strategies to minimize the impact of interest rate fluctuations on its gross interest rate margin, including the use of derivative financial instruments, the regular sale or pledging of auto receivables to securitization Trusts and pre-funding of securitization transactions.

In its securitization transactions, the Company transfers fixed rate finance receivables to Trusts that, in turn, sell either fixed rate or floating rate securities to investors. The fixed rates on securities issued by the Trusts are indexed to market interest rate swap spreads for transactions of similar duration or various London Interbank Offered Rates (“LIBOR”) and do not fluctuate during the term of the securitization. The floating rates on securities issued by the Trusts are indexed to LIBOR and fluctuate periodically based on movements in LIBOR. Derivative financial instruments, such as interest rate swap and cap agreements, are used to manage the gross interest rate spread on these transactions. The Company uses interest rate swap agreements to convert the variable rate exposures on securities issued by its securitization Trusts to a fixed rate, thereby locking in the gross interest rate spread to be earned by the Company over the life of a securitization accounted for as a secured financing that would have been affected by changes in interest rates. Interest rate swap agreements purchased by the Company do not impact the amount of cash flows to be received by holders of the asset-backed securities issued by the Trusts. The interest rate swap agreements serve to offset the impact of increased or decreased interest paid by the Trusts on floating rate asset-backed securities on the cash flows to be received by the Company from the Trusts. The Company utilizes such arrangements to modify its net interest sensitivity to levels deemed appropriate based on the Company’s risk tolerance. In circumstances where the interest rate risk is deemed to be tolerable, usually if the risk is less than one year in term at inception, the Company may choose not to hedge potential fluctuations in cash flows due to changes in interest rates. The Company’s special purpose finance subsidiaries are contractually required to provide additional credit enhancement on their floating rate securities even if the Company chooses not to hedge its future cash flows. To comply with this requirement, the special purpose finance subsidiary purchases an interest rate cap agreement. Although the interest rate cap agreements are purchased by the Trusts, cash outflows from the Trusts ultimately impact the Company’s retained interests in the securitization transactions as cash expended by the securitization Trusts will decrease the ultimate amount of cash to be received by the Company. Therefore, when economically feasible, the Company may simultaneously sell a corresponding interest rate cap agreement to offset the premium paid by the Trust to purchase the interest rate cap agreement. The fair value of the interest rate cap agreements purchased by the special purpose finance subsidiaries in connection with securitization transactions structured as secured financings are included in other assets and the fair value of the interest rate cap agreements sold by the Company are included in other liabilities on the Company’s consolidated balance sheets. Changes in the fair value of the interest rate cap agreements purchased and sold by the Company are reflected in interest expense on the Company’s consolidated statements of income.

Pre-funding securitizations is the practice of issuing more asset-backed securities than needed to cover finance receivables initially sold or pledged to the Trust. The proceeds from the pre-funded portion are held in an escrow account until additional receivables are delivered to the Trust in amounts up to the pre-funded balance held in the escrow account. The use of pre-funded securitizations allows the Company to lock in borrowing costs with respect to the finance receivables subsequently delivered to the Trust. However, the Company incurs an expense in pre-funded securitizations during the period between the initial securitization and the subsequent delivery of finance receivables equal to the difference between the interest earned on the proceeds held in the escrow account and the interest rate paid on the asset-backed securities outstanding.

Management monitors the Company’s hedging activities to ensure that the value of derivative financial instruments, their correlation to the contracts being hedged and the amounts being hedged continue to provide effective protection against interest rate risk. However, there can be no assurance that the Company’s strategies will be effective in minimizing interest rate risk or that increases in interest rates will not have an adverse effect on the Company’s profitability. All transactions are entered into for purposes other than trading.

FORWARD LOOKING STATEMENTS

The preceding Management’s Discussion and Analysis of Financial Condition and Results of Operations section contains several “forward-looking statements.” Forward-looking statements are those that use words such as “believe,” “expect,” “anticipate,” “intend,” “plan,” “may,” “will,” “likely,” “should,” “estimate,” “continue,” “future” or other comparable expressions. These words indicate future events and trends. Forward-looking statements are the Company’s current views with respect to future events and financial performance. These forward-looking statements are subject to many assumptions, risks and uncertainties that could cause actual results to differ significantly from historical results or from those anticipated by the Company. The most significant risks are detailed from time to time in the Company’s filings and reports with the Securities and Exchange Commission including the Company’s Annual Report on Form 10-K for the year ended June 30, 2005. It is advisable not to place undue reliance on the Company’s forward-looking statements. Additional risks include risks relating to acquisitions, including that of BVAC. The Company undertakes no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

Item 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

Because the Company’s funding strategy is dependent upon the issuance of interest-bearing securities and the incurrence of debt, fluctuations in interest rates impact the Company’s profitability. Therefore, the Company employs various hedging strategies to minimize the risk of interest rate fluctuations. See “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Interest Rate Risk” for additional information regarding such market risks.

Item 4. CONTROLS AND PROCEDURES

Evaluation of Disclosure Controls and Procedures

The Company maintains disclosure controls and procedures that are designed to ensure that information required to be disclosed in the reports it files under the Securities and Exchange Act of 1934, as amended, is recorded, processed, summarized and reported within the time periods specified in the Commission’s rules and forms. Such controls include those designed to ensure that information for disclosure is communicated to management, including the Chief Executive Officer (“CEO”) and Chief Financial Officer (“CFO”), as appropriate to allow timely decisions regarding required disclosure.

In connection with the restatement of the Company’s Consolidated Statements of Cash Flows described in Note 2 to the consolidated financial statements, and as a result of the material weakness described below, they have concluded that the Company’s disclosure controls and procedures are not effective as of September 30, 2005.

Material Weakness In Internal Control Over Financial Reporting

A material weakness is a control deficiency or a combination of control deficiencies that result in a more than remote likelihood that a material misstatement of the annual or interim consolidated financial statements will not be prevented or detected.

As of September 30, 2005, the Company did not maintain effective controls over the classification of cash flows received from retained interests classified as available for sale securities in its consolidated statements of cash flows. Specifically, the Company did not correctly interpret Statement of Financial Accounting Standards No. 102, “Statement of Cash Flows-Exemption of Certain Enterprises and Classification of Cash Flows from Certain Securities Acquired for Resale,” paragraph 8, and cash flows received from retained interests classified as available for sale securities were presented as operating cash flows instead of investing cash flows on the consolidated statements of cash flows. This control deficiency resulted in the restatement of the consolidated statements of cash flows for the years ended June 30, 2005, 2004 and 2003, and the three months ended September 30, 2005. Additionally, this control deficiency could result in a misstatement of the operating and investing cash flows that would result in a material misstatement to the Company’s annual or interim financial statements that would not be prevented or detected. Accordingly, management determined that this control deficiency constitutes a material weakness.

As of the current date of this filing, the Company has fully remediated this material weakness. The Company will monitor all new pronouncements related to the Statement of Cash Flows as well as continue to diligently review all cash flow pronouncements related to classification of items on the cash flow statement.

Internal Control Over Financial Reporting

There were no changes made in the Company’s internal control over financial reporting during the three months ended September 30, 2005, that have materially affected, or are reasonably likely to materially affect, the Company’s internal controls over financial reporting.

Limitations Inherent in all Controls

The Company’s management, including the CEO and CFO, recognize that the disclosure controls and internal controls (discussed above) cannot prevent all errors or all attempts at fraud. Any controls system, no matter how well crafted and operated, can only provide reasonable, and not absolute, assurance of achieving the desired control objectives, and management was required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Because of the inherent limitations in any control system, no evaluation or implementation of a control system can provide complete assurance that all control issues and all possible instances of fraud have been or will be detected.

Part II. OTHER INFORMATION

Item 1. LEGAL PROCEEDINGS

fraud, breach of contract and discriminatory treatment of credit applicants. Some litigation against the Company could take the form of class action complaints by consumers. As the assignee of finance contracts originated by dealers, the Company may also be named as a co-defendant in lawsuits filed by consumers principally against dealers. The damages and penalties claimed by consumers in these types of matters can be substantial. The relief requested by the plaintiffs varies but can include requests for compensatory, statutory and punitive damages. The Company believes that it has taken prudent steps to address and mitigate the litigation risks associated with its business activities.

In fiscal 2003, several complaints were filed by shareholders against the Company and certain of the Company’s officers and directors alleging violations of Sections 10(b) and 20(a) of the Securities Exchange Act of 1934 and Rule 10b-5 thereunder as well as violations of Sections 11 and 15 of the Securities Act of 1933 in connection with the Company’s secondary public offering of common stock on October 1, 2002. These complaints have been consolidated into one action, styled Pierce v. AmeriCredit Corp., et al., pending in the United States District Court for the Northern District of Texas, Fort Worth Division; the plaintiff in Pierce seeks class action status. In Pierce, the plaintiff claims, among other allegations, that deferments were improperly granted by the Company to avoid delinquency triggers in securitization transactions and enhance cash flows and to incorrectly report charge-offs and delinquency percentages, thereby causing the Company to misrepresent its financial performance throughout the alleged class period. The plaintiff also alleges that the Company’s registration statement and prospectus for the offering contained untrue statements of material facts and omitted to state material facts necessary to make other statements in the registration statement not misleading.

behalf of nominal defendant AmeriCredit Corp. v. Clifton H. Morris, Jr., et al. A second shareholder derivative action was filed in the District Court of Tarrant County, Texas 48^th Judicial District, on August 19, 2003, entitled David Harris, derivatively and on behalf of nominal defendant AmeriCredit Corp. v. Clifton H. Morris, Jr., et al. Both of these shareholder derivative actions allege, among other complaints, that certain officers and directors of the Company breached their respective fiduciary duties by causing the Company to make improper deferments, violate federal and state securities laws and issue misleading financial statements. The substantive allegations in both of the derivative actions are essentially the same as those in the above-referenced consolidated class action. A special litigation committee (“SLC”) of the Board of Directors was created to investigate the claims in the derivative actions. In September 2005, the SLC completed its investigation of the claims made by the derivative plaintiffs in Rosenthal and Harris and rendered its decision that continuation of the derivative proceeding is not in the best interests of the Company. Accordingly, the Company has filed a Motion to Dismiss each derivative complaint. As a nominal defendant, the Company does not believe that it has any ultimate liability with respect to these derivative actions.

Item 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS

During the three months ended September 30, 2005, the Company repurchased shares as follows (dollars in thousands, except per share amounts):


Date	Total Number of Shares Purchased	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Plans or Program	Approximate Dollar of Shares That May Yet Be Purchased Under the Plans or Program (b)
July 2005 (a)	1,190,100	$	26.27	1,190,100	$	273,993
August 2005 (a)	3,182,372	$	25.48	3,182,372	$	192,921
September 2005 (a)	3,704,659	$	24.77	3,704,659	$	101,148

(a)

On January 25, 2005, the Company announced the approval of a stock repurchase plan by its Board of Directors which authorized the Company to repurchase up to $500.0 million of its common stock in the open market or in privately negotiated transactions, based on market conditions.

(b)

On October 25, 2005, the Company announced the approval of a stock repurchase plan by its Board of Directors which authorized the Company to repurchase up to $300.0 million of its common stock in the open market or in privately negotiated transactions, based on market conditions. This additional authorization is not included in these amounts.

Item 3. DEFAULTS UPON SENIOR SECURITIES

Not Applicable

Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

Not Applicable

Item 5. OTHER INFORMATION

On November 7, 2005, the Company entered into amended and restated employment agreements with certain of its executive officers, namely Clifton H. Morris, Jr., Daniel E. Berce, Chris A. Choate, Mark Floyd and Preston A. Miller to reflect, among other things, amendments to the provisions relating to (i) position and responsibilities, (ii) base salary and (iii) certain severance arrangements to comply with Section 409A of the Internal Revenue Code. These amended and restated employment agreements provide that the officer’s base salary is determined annually by the Compensation Committee, subject to the following minimum annual compensation: Mr. Morris, $900,000; Mr. Berce, $950,000; Mr. Choate, $425,000; Mr. Floyd, $450,000; and Mr. Miller, $450,000. In the event of a change of control, the amended and restated employment agreement for Mr. Berce provides that the Company will pay an amount in a lump sum six months after the date of termination due to a change of control equal to the current year’s salary (undiscounted) plus the present value (employing a discount rate of 8%) of two additional years’ salary in effect immediately prior to the event giving rise to the change of control, in which case “salary” shall mean the sum of (i) the highest annual rate of compensation in any of the seven fiscal years preceding the year in which there shall occur a change of control,

plus (ii) the highest annual cash bonus or other cash incentive compensation in any of the seven fiscal years preceding the year in which there shall occur a change of control. The amended and restated employment agreements also provide that “change of control” shall be deemed to have occurred (i) on the date that any one person, or more than one person acting as a group, acquires ownership of stock of the Company that, together with stock held by such person or group, constitutes more than 50% of the total fair market value or total voting power of the stock of the Company, (ii) on the date that a majority of the members of the Company’s Board of Directors is replaced during any 12-month period by directors whose appointment or election is not endorsed by a majority of the members of the Company’s Board of Directors prior to the date of the appointment or election or (iii) on the date any one person, or more than one person acting as a group acquires (or has acquired during the 12-month period ending on the date of the most recent acquisition by such person or persons) assets from the Company that have a total gross fair market value equal to or more than 40% of the total gross fair market value of all the assets of the Company immediately prior to such acquisition or acquisitions. In the event of a constructive termination, the amended and restated employment agreements for Messrs. Morris and Berce provide that the Company will pay an amount in a lump sum six months after the date of the constructive termination equal to the current year’s salary (undiscounted) plus the present value (employing a discount rate of 8%) of two additional years’ salary in effect immediately prior to the event giving rise to the constructive termination, in which case “salary” shall have the same meaning as defined above in connection with a change of control.

Item 6. EXHIBITS



31.1		Officers’ Certifications of Periodic Report pursuant to Section 302 of Sarbanes-Oxley Act of 2002

32.1		Officers’ Certifications of Periodic Report pursuant to Section 906 of Sarbanes-Oxley Act of 2002

SIGNATURE

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


		AmeriCredit Corp. (Registrant)

Date: February 6, 2006	By:	/s/ Chris A. Choate
		(Signature)
		Chris A. Choate
		Executive Vice President,
		Chief Financial Officer and Treasurer