Document and Entity Information
Document and Entity Information Document - USD ($) $ in Millions | 12 Months Ended | ||
Sep. 30, 2016 | Nov. 09, 2016 | Mar. 31, 2016 | |
Entity Information [Line Items] | |||
Entity Registrant Name | VISA INC. | ||
Entity Central Index Key | 1,403,161 | ||
Current Fiscal Year End Date | --09-30 | ||
Entity Filer Category | Large Accelerated Filer | ||
Document Type | 10-K | ||
Document Period End Date | Sep. 30, 2016 | ||
Document Fiscal Year Focus | 2,016 | ||
Document Fiscal Period Focus | FY | ||
Amendment Flag | false | ||
Entity Well-known Seasoned Issuer | Yes | ||
Entity Voluntary Filers | No | ||
Entity Current Reporting Status | Yes | ||
Entity Public Float | $ 145,500 | ||
Class A common stock | |||
Entity Information [Line Items] | |||
Entity Common Stock, Shares Outstanding | 1,867,580,597 | ||
Class B common stock | |||
Entity Information [Line Items] | |||
Entity Common Stock, Shares Outstanding | 245,513,385 | ||
Class C common stock | |||
Entity Information [Line Items] | |||
Entity Common Stock, Shares Outstanding | 16,814,896 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Millions | Sep. 30, 2016 | Sep. 30, 2015 |
Assets | ||
Cash and cash equivalents | $ 5,619 | $ 3,518 |
Restricted cash—U.S. litigation escrow (Note 3) | 1,027 | 1,072 |
Investment securities (Note 4): | ||
Trading | 71 | 66 |
Available-for-sale | 3,248 | 2,431 |
Settlement receivable | 1,467 | 408 |
Accounts receivable | 1,041 | 847 |
Customer collateral (Note 11) | 1,001 | 1,023 |
Current portion of client incentives | 284 | 303 |
Prepaid expenses and other current assets (Note 5) | 555 | 353 |
Total current assets | 14,313 | 10,021 |
Investment securities, available-for-sale (Note 4) | 3,931 | 3,384 |
Client incentives | 448 | 110 |
Property, equipment and technology, net (Note 6) | 2,150 | 1,888 |
Other assets (Note 5) | 893 | 778 |
Intangible assets, net (Note 7) | 27,234 | 11,361 |
Goodwill | 15,066 | 11,825 |
Total assets | 64,035 | 39,367 |
Liabilities | ||
Accounts payable | 203 | 127 |
Settlement payable | 2,084 | 780 |
Customer collateral (Note 11) | 1,001 | 1,023 |
Accrued compensation and benefits | 673 | 503 |
Client incentives | 1,976 | 1,049 |
Accrued liabilities (Note 8) | 1,128 | 849 |
Accrued litigation (Note 20) | 981 | 1,024 |
Total current liabilities | 8,046 | 5,355 |
Long-term debt (Note 9) | 15,882 | 0 |
Deferred tax liabilities (Note 19) | 4,808 | 3,273 |
Deferred purchase consideration (Note 2) | 1,225 | 0 |
Other liabilities (Note 8) | 1,162 | 897 |
Total liabilities | 31,123 | 9,525 |
Commitments and contingencies (Note 17) | ||
Equity | ||
Treasury stock (Note 2 and Note 14) | (170) | 0 |
Right to recover for covered losses (Note 3) | (34) | 0 |
Additional paid-in capital | 17,395 | 18,073 |
Accumulated income | 10,462 | 11,843 |
Accumulated other comprehensive loss, net: | ||
Investment securities, available-for-sale | 36 | 5 |
Defined benefit pension and other postretirement plans | (225) | (161) |
Derivative instruments classified as cash flow hedges | (50) | 83 |
Foreign currency translation adjustments | (219) | (1) |
Total accumulated other comprehensive loss, net | (458) | (74) |
Total equity | 32,912 | 29,842 |
Total liabilities and equity | 64,035 | 39,367 |
Series A convertible participating preferred stock | ||
Equity | ||
Preferred stock (Note 14) | 0 | 0 |
Series B convertible participating preferred stock | ||
Equity | ||
Preferred stock (Note 14) | 2,516 | 0 |
Series C convertible participating preferred stock | ||
Equity | ||
Preferred stock (Note 14) | 3,201 | 0 |
Class A common stock | ||
Equity | ||
Common stock (Note 14) | 0 | 0 |
Class B common stock | ||
Equity | ||
Common stock (Note 14) | 0 | 0 |
Class C common stock | ||
Equity | ||
Common stock (Note 14) | $ 0 | $ 0 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - $ / shares | Sep. 30, 2016 | Sep. 30, 2015 | |
Series A convertible participating preferred stock | |||
Preferred stock, shares issued | 0 | 0 | |
Series B convertible participating preferred stock | |||
Preferred stock, shares issued | 2,000,000 | 0 | |
Preferred stock, shares outstanding | 2,000,000 | 0 | |
Series C convertible participating preferred stock | |||
Preferred stock, shares issued | 3,000,000 | 0 | |
Preferred stock, shares outstanding | 3,000,000 | 0 | |
Class A common stock | |||
Common stock, par value | $ 0.0001 | $ 0.0001 | |
Common stock, shares authorized | 2,001,622,000,000 | 2,001,622,000,000 | |
Common stock, shares, issued | 1,871,000,000 | 1,950,000,000 | |
Common stock, shares, outstanding | 1,871,000,000 | [1] | 1,950,000,000 |
Class B common stock | |||
Common stock, par value | $ 0.0001 | $ 0.0001 | |
Common stock, shares authorized | 622,000,000 | 622,000,000 | |
Common stock, shares, issued | 245,000,000 | 245,000,000 | |
Common stock, shares, outstanding | 245,000,000 | 245,000,000 | |
Class C common stock | |||
Common stock, par value | $ 0.0001 | $ 0.0001 | |
Common stock, shares authorized | 1,097,000,000 | 1,097,000,000 | |
Common stock, shares, issued | 17,000,000 | 20,000,000 | |
Common stock, shares, outstanding | 17,000,000 | 20,000,000 | |
Preferred Stock | |||
Preferred stock, par value | $ 0.0001 | $ 0.0001 | |
Preferred stock, shares authorized | 25,000,000 | 25,000,000 | |
Preferred stock, shares issued | 5,000,000 | 0 | |
[1] | {F|ahBzfndlYmZpbGluZ3MtaHJkcmoLEgZYTUxEb2MiXlhCUkxEb2NHZW5JbmZvOmVhOWM1MDkzNjQ1MjRmNzk4OTM0M2I5ZDEyODM0M2JlfFRleHRTZWxlY3Rpb246OENBNzc3NzIxMjY1M0Y0NTY4MDI2RUY3NTNDRjY1NjMM} |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Millions, $ in Millions | 12 Months Ended | |||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2014 | ||
Operating Revenues | ||||
Service revenues | $ 6,747 | [1] | $ 6,302 | $ 5,797 |
Data processing revenues | 6,272 | [1] | 5,552 | 5,167 |
International transaction revenues | 4,649 | [1] | 4,064 | 3,560 |
Other revenues | 823 | [1] | 823 | 770 |
Client incentives | (3,409) | [1] | (2,861) | (2,592) |
Net operating revenues | 15,082 | [1] | 13,880 | 12,702 |
Operating Expenses | ||||
Personnel | 2,226 | [1] | 2,079 | 1,875 |
Marketing | 869 | [1] | 872 | 900 |
Network and processing | 538 | [1] | 474 | 507 |
Professional fees | 389 | [1] | 336 | 328 |
Depreciation and amortization | 502 | [1] | 494 | 435 |
General and administrative | 796 | [1] | 547 | 507 |
Litigation provision (Note 20) | 2 | [1] | 14 | 453 |
Visa Europe Framework Agreement loss (Note 2) | 1,877 | 0 | 0 | |
Total operating expenses | 7,199 | [1] | 4,816 | 5,005 |
Operating income | 7,883 | [1] | 9,064 | 7,697 |
Non-operating Income (Expense) | ||||
Interest expense | (427) | [1] | (3) | (8) |
Other (Note 4 and Note 12) | 556 | [1] | (66) | 35 |
Non-operating income (expense) | 129 | [1] | (69) | 27 |
Income before income taxes | 8,012 | [1] | 8,995 | 7,724 |
Income tax provision (Note 19) | 2,021 | [1] | 2,667 | 2,286 |
Net income | $ 5,991 | [1] | $ 6,328 | $ 5,438 |
Class A common stock | ||||
Earnings Per Share [Abstract] | ||||
Basic earnings per share (Note 15) | $ 2.49 | [1],[2] | $ 2.58 | $ 2.16 |
Basic weighted-average shares outstanding (Note 15) | 1,906 | [1] | 1,954 | 1,993 |
Diluted earnings per share (Note 15) | $ 2.48 | [1],[2] | $ 2.58 | $ 2.16 |
Diluted weighted-average shares outstanding (Note 15) | 2,414 | [1],[2],[3] | 2,457 | 2,523 |
Class B common stock | ||||
Earnings Per Share [Abstract] | ||||
Basic earnings per share (Note 15) | $ 4.10 | [1],[2],[4] | $ 4.26 | $ 3.63 |
Basic weighted-average shares outstanding (Note 15) | 245 | [1] | 245 | 245 |
Diluted earnings per share (Note 15) | $ 4.09 | [1],[2],[4] | $ 4.25 | $ 3.62 |
Diluted weighted-average shares outstanding (Note 15) | 245 | [1],[2],[4] | 245 | 245 |
Class C common stock | ||||
Earnings Per Share [Abstract] | ||||
Basic earnings per share (Note 15) | $ 9.94 | [1],[2],[4] | $ 10.33 | $ 8.65 |
Basic weighted-average shares outstanding (Note 15) | 19 | [1] | 22 | 26 |
Diluted earnings per share (Note 15) | $ 9.93 | [1],[2],[4] | $ 10.30 | $ 8.62 |
Diluted weighted-average shares outstanding (Note 15) | 19 | [1],[2],[4] | 22 | 26 |
[1] | The Company did not include Visa Europe's financial results in the Company's consolidated statements of operations from the acquisition date, June 21, 2016, through June 30, 2016 as the impact was immaterial. The Company's consolidated statement of operations for the year ended September 30, 2016 includes Visa Europe's financial results for the three months ended September 30, 2016. See Note 2—Acquisition of Visa Europe. | |||
[2] | Figures in the table may not recalculate exactly due to rounding. Earnings per share is calculated based on unrounded numbers. The number of shares and per share amounts for the prior periods presented have been retroactively adjusted to reflect the four-for-one stock split effected in the fiscal second quarter of 2015. See Note 14—Stockholders' Equity. | |||
[3] | Weighted-average diluted shares outstanding are calculated on an as-converted basis, and include incremental common stock equivalents, as calculated under the treasury stock method. The computation includes 5 million, 6 million and 7 million common stock equivalents for fiscal 2016, 2015 and 2014, respectively, because their effect would have been dilutive. The computation excludes 2 million of common stock equivalents for fiscal 2016, 2015 and 2014 because their effect would have been anti-dilutive. | |||
[4] | . |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME - USD ($) $ in Millions | 12 Months Ended | |||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2014 | ||
Statement of Comprehensive Income [Abstract] | ||||
Net income | $ 5,991 | [1] | $ 6,328 | $ 5,438 |
Investment securities, available-for-sale: | ||||
Net unrealized gain (loss) | 51 | (21) | (44) | |
Income tax effect | (18) | 8 | 17 | |
Reclassification adjustment for net gain realized in net income | (3) | (21) | (1) | |
Income tax effect | 1 | 8 | 0 | |
Defined benefit pension and other postretirement plans: | ||||
Net unrealized actuarial gain (loss) and prior service credit | (106) | (122) | (27) | |
Income tax effect | 36 | 45 | 8 | |
Amortization of actuarial loss (gain) and prior service credit realized in net income | 10 | (1) | (8) | |
Income tax effect | (4) | 1 | 3 | |
Derivative instruments classified as cash flow hedges: | ||||
Net unrealized (loss) gain | (74) | 172 | 65 | |
Income tax effect | 9 | (51) | (13) | |
Reclassification adjustment for net gain realized in net income | (103) | (102) | (46) | |
Income tax effect | 35 | 26 | 9 | |
Foreign currency translation adjustments | (218) | 1 | (1) | |
Other comprehensive loss, net of tax | (384) | (57) | (38) | |
Comprehensive income | $ 5,607 | $ 6,271 | $ 5,400 | |
[1] | The Company did not include Visa Europe's financial results in the Company's consolidated statements of operations from the acquisition date, June 21, 2016, through June 30, 2016 as the impact was immaterial. The Company's consolidated statement of operations for the year ended September 30, 2016 includes Visa Europe's financial results for the three months ended September 30, 2016. See Note 2—Acquisition of Visa Europe. |
CONSOLIDATED STATEMENTS OF CHAN
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY - USD ($) shares in Millions, $ in Millions | Total | Class A common stock | Class B common stock | [1],[2] | Class C common stock | [1],[2] | Preferred Stock | Preferred StockSeries B Preferred Stock | Preferred StockSeries C Preferred Stock | Common StockClass A common stock | Common StockClass B common stock | Common StockClass C common stock | Treasury Stock | Right to Recover for Covered Losses | Additional Paid-In Capital | Accumulated Income | Accumulated Other Comprehensive Income (Loss) | |||||
Beginning Balance (in shares) at Sep. 30, 2013 | 2,031 | 245 | 27 | |||||||||||||||||||
Beginning Balance at Sep. 30, 2013 | $ 26,870 | $ 18,875 | $ 7,974 | $ 21 | ||||||||||||||||||
Net income | 5,438 | [1] | $ 4,307 | [1] | $ 892 | $ 222 | 5,438 | |||||||||||||||
Other comprehensive loss, net of tax | (38) | (38) | ||||||||||||||||||||
Comprehensive income | 5,400 | |||||||||||||||||||||
Conversion of class C common stock upon sale into public market (in shares) | 19 | (5) | ||||||||||||||||||||
Issuance and vesting of restricted stock and performance-based shares (in shares) | 4 | |||||||||||||||||||||
Share-based compensation, net of forfeitures (Note 16) (in shares) | [3] | (1) | ||||||||||||||||||||
Share-based compensation, net of forfeitures (Note 16) | 172 | 172 | ||||||||||||||||||||
Restricted stock and performance-based shares settled in cash for taxes (in shares) | (1) | |||||||||||||||||||||
Restricted stock and performance-based shares settled in cash for taxes | 86 | 86 | ||||||||||||||||||||
Excess tax benefit for share-based compensation | 90 | 90 | ||||||||||||||||||||
Cash proceeds from issuance of common stock under employee equity plans (in shares) | 5 | |||||||||||||||||||||
Cash proceeds from issuance of common stock under employee equity plans | 91 | 91 | ||||||||||||||||||||
Cash dividends declared and paid, at a quarterly amount of $0.14 in FY 2016, $0.12 in FY 2015, and $0.10 in FY 2014 per as-converted share | (1,006) | (1,006) | ||||||||||||||||||||
Repurchase of class A common stock (in shares) | (79) | |||||||||||||||||||||
Repurchase of class A common stock | (4,118) | (843) | (3,275) | |||||||||||||||||||
Ending Balance (in shares) at Sep. 30, 2014 | 1,978 | 245 | 22 | |||||||||||||||||||
Ending Balance at Sep. 30, 2014 | 27,413 | 18,299 | 9,131 | (17) | ||||||||||||||||||
Net income | 6,328 | [1] | $ 5,044 | [1] | 1,045 | 224 | 6,328 | |||||||||||||||
Other comprehensive loss, net of tax | (57) | (57) | ||||||||||||||||||||
Comprehensive income | 6,271 | |||||||||||||||||||||
Conversion of class C common stock upon sale into public market (in shares) | 11 | (2) | ||||||||||||||||||||
Issuance and vesting of restricted stock and performance-based shares (in shares) | 4 | |||||||||||||||||||||
Share-based compensation, net of forfeitures (Note 16) (in shares) | [3] | (1) | ||||||||||||||||||||
Share-based compensation, net of forfeitures (Note 16) | 187 | 187 | ||||||||||||||||||||
Restricted stock and performance-based shares settled in cash for taxes (in shares) | (1) | |||||||||||||||||||||
Restricted stock and performance-based shares settled in cash for taxes | 108 | 108 | ||||||||||||||||||||
Excess tax benefit for share-based compensation | 84 | 84 | ||||||||||||||||||||
Cash proceeds from issuance of common stock under employee equity plans (in shares) | 3 | |||||||||||||||||||||
Cash proceeds from issuance of common stock under employee equity plans | 82 | 82 | ||||||||||||||||||||
Cash dividends declared and paid, at a quarterly amount of $0.14 in FY 2016, $0.12 in FY 2015, and $0.10 in FY 2014 per as-converted share | (1,177) | (1,177) | ||||||||||||||||||||
Repurchase of class A common stock (in shares) | (44) | [4] | (44) | |||||||||||||||||||
Repurchase of class A common stock | (2,910) | $ (2,910) | (471) | (2,439) | ||||||||||||||||||
Ending Balance (in shares) at Sep. 30, 2015 | 0 | [5] | 0 | [5] | 1,950 | 245 | 20 | |||||||||||||||
Ending Balance at Sep. 30, 2015 | 29,842 | $ 0 | $ 0 | $ 0 | 18,073 | 11,843 | (74) | |||||||||||||||
Net income | 5,991 | [1] | $ 4,738 | [1] | $ 1,006 | $ 185 | 5,991 | |||||||||||||||
Other comprehensive loss, net of tax | (384) | (384) | ||||||||||||||||||||
Comprehensive income | 5,607 | |||||||||||||||||||||
Issuance of preferred stock (Note 2 and Note 14) (in shares) | [5] | 2 | 3 | |||||||||||||||||||
Issuance of preferred stock (Note 2 and Note 14) | 5,717 | 5,717 | ||||||||||||||||||||
VE territory covered losses incurred (Note 3) | (34) | (34) | ||||||||||||||||||||
Class C common stock held by Visa Europe, a wholly-owned subsidiary of Visa Inc. (Note 2 and Note 14) (in shares) | (1) | |||||||||||||||||||||
Class C common stock held by Visa Europe, a wholly-owned subsidiary of Visa Inc. (Note 2 and Note 14) | 0 | (170) | ||||||||||||||||||||
Conversion of class C common stock upon sale into public market (in shares) | 8 | (2) | ||||||||||||||||||||
Issuance and vesting of restricted stock and performance-based shares (in shares) | 2 | |||||||||||||||||||||
Share-based compensation, net of forfeitures (Note 16) (in shares) | [3] | 0 | ||||||||||||||||||||
Share-based compensation, net of forfeitures (Note 16) | 221 | 221 | ||||||||||||||||||||
Restricted stock and performance-based shares settled in cash for taxes (in shares) | (1) | |||||||||||||||||||||
Restricted stock and performance-based shares settled in cash for taxes | 92 | 92 | ||||||||||||||||||||
Excess tax benefit for share-based compensation | 63 | 63 | ||||||||||||||||||||
Cash proceeds from issuance of common stock under employee equity plans (in shares) | 3 | |||||||||||||||||||||
Cash proceeds from issuance of common stock under employee equity plans | 95 | 95 | ||||||||||||||||||||
Cash dividends declared and paid, at a quarterly amount of $0.14 in FY 2016, $0.12 in FY 2015, and $0.10 in FY 2014 per as-converted share | (1,350) | (1,350) | ||||||||||||||||||||
Repurchase of class A common stock (in shares) | (91) | [4],[6] | (91) | |||||||||||||||||||
Repurchase of class A common stock | (6,987) | $ (6,987) | [6] | (965) | (6,022) | |||||||||||||||||
Ending Balance (in shares) at Sep. 30, 2016 | 2 | [5] | 3 | [5] | 1,871 | 245 | 17 | |||||||||||||||
Ending Balance at Sep. 30, 2016 | $ 32,912 | $ 5,717 | $ (170) | $ (34) | $ 17,395 | $ 10,462 | $ (458) | |||||||||||||||
[1] | Net income attributable to Visa Inc. is allocated based on proportional ownership on an as-converted basis. The weighted-average number of shares of as-converted class B common stock used in the income allocation were 405 million for fiscal 2016 and 2015 and 413 million for fiscal 2014. The weighted-average number of shares of as-converted class C common stock used in the income allocation was 75 million, 87 million and 103 million for fiscal 2016, 2015 and 2014, respectively. | |||||||||||||||||||||
[2] | . | |||||||||||||||||||||
[3] | Decrease in Class A common stock related to forfeitures of restricted stock awards. | |||||||||||||||||||||
[4] | All shares repurchased in the open market have been retired and constitute authorized but unissued shares. | |||||||||||||||||||||
[5] | Series B and C preferred stock are alternatively referred to as U.K.&I and Europe preferred stock, respectively. | |||||||||||||||||||||
[6] | (in millions, except per share data)2016 (1) 2015Shares repurchased in the open market(2)91 44Average repurchase price per share(3)$77.05 $65.98Total cost$6,987 $2,910 |
CONSOLIDATED STATEMENTS OF CHA7
CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY (Parenthetical) - $ / shares | 12 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2014 | |
Statement of Stockholders' Equity [Abstract] | |||
Cash dividends declared and paid, quarterly, per as-converted share | $ 0.14 | $ 0.12 | $ 0.10 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Millions | 12 Months Ended | |||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2014 | ||
Operating Activities | ||||
Net income | $ 5,991 | [1] | $ 6,328 | $ 5,438 |
Adjustments to reconcile net income to net cash provided by operating activities: | ||||
Client incentives | 3,409 | 2,861 | 2,592 | |
Fair value adjustment for the Visa Europe put option | (255) | 110 | 0 | |
Share-based compensation | 221 | 187 | 172 | |
Excess tax benefit for share-based compensation | (63) | (84) | (90) | |
Depreciation and amortization of property, equipment, technology and intangible assets | 502 | [1] | 494 | 435 |
Deferred income taxes | (764) | 195 | (580) | |
Right to recover for covered losses recorded in equity | (9) | 0 | 0 | |
Litigation provision (Note 20) | 4 | 14 | 453 | |
Other | 64 | 24 | 37 | |
Change in operating assets and liabilities: | ||||
Settlement receivable | 391 | 378 | 13 | |
Accounts receivable | (65) | (19) | (53) | |
Client incentives | (3,508) | (2,970) | (2,395) | |
Other assets | (315) | (41) | (379) | |
Accounts payable | 43 | (13) | (56) | |
Settlement payable | (302) | (552) | 107 | |
Accrued and other liabilities | 277 | 118 | 513 | |
Accrued litigation (Note 20) | (47) | (446) | 998 | |
Net cash provided by operating activities | 5,574 | 6,584 | 7,205 | |
Investing Activities | ||||
Purchases of property, equipment, technology and intangible assets | (523) | (414) | (553) | |
Proceeds from sales of property, equipment and technology | 0 | 10 | 0 | |
Investment securities, available-for-sale: | ||||
Purchases | (28,004) | (2,850) | (2,572) | |
Proceeds from maturities and sales | 26,697 | 1,925 | 2,342 | |
Acquisitions, net of $2.8 billion cash received from Visa Europe (Note 2) | (9,082) | (93) | (149) | |
Purchases of / contributions to other investments | (10) | (25) | (9) | |
Proceeds / distributions from other investments | 6 | 12 | 0 | |
Net cash used in investing activities | (10,916) | (1,435) | (941) | |
Financing Activities | ||||
Dividends paid (Note 14) | (1,350) | (1,177) | (1,006) | |
Proceeds from issuance of senior notes (Note 9) | 15,971 | 0 | 0 | |
Debt issuance costs (Note 9) | (98) | 0 | 0 | |
Deposit into U.S. litigation escrow account—U.S. retrospective responsibility plan (Note 3 and Note 20) | 0 | 0 | (450) | |
Payments from (return to) U.S. litigation escrow account—U.S. retrospective responsibility plan (Note 3 and Note 20) | 45 | 426 | (999) | |
Cash proceeds from issuance of common stock under employee equity plans | 95 | 82 | 91 | |
Restricted stock and performance-based shares settled in cash for taxes | (92) | (108) | (86) | |
Excess tax benefit for share-based compensation | 63 | 84 | 90 | |
Net cash provided by (used in) financing activities | 7,477 | (3,603) | (6,478) | |
Effect of exchange rate changes on cash and cash equivalents | (34) | 1 | (1) | |
Increase (decrease) in cash and cash equivalents | 2,101 | 1,547 | (215) | |
Cash and cash equivalents at beginning of year | 3,518 | 1,971 | 2,186 | |
Cash and cash equivalents at end of year | 5,619 | 3,518 | 1,971 | |
Supplemental Disclosure | ||||
Series B and C convertible participating preferred stock issued in Visa Europe acquisition (Note 2) | 5,717 | 0 | 0 | |
Deferred purchase consideration recorded for Visa Europe acquisition (Note 2) | 1,236 | 0 | 0 | |
Income taxes paid, net of refunds | 2,842 | 2,486 | 2,656 | |
Interest payments on debt | 244 | 0 | 0 | |
Accruals related to purchases of property, equipment, technology and intangible assets | 42 | 81 | 62 | |
Right to recover for covered losses related to Visa Europe acquisition (Note 2) | (34) | 0 | 0 | |
Class A common stock | ||||
Financing Activities | ||||
Repurchase of common stock | (6,987) | (2,910) | (4,118) | |
Class C common stock | ||||
Financing Activities | ||||
Repurchase of common stock | $ (170) | $ 0 | $ 0 | |
[1] | The Company did not include Visa Europe's financial results in the Company's consolidated statements of operations from the acquisition date, June 21, 2016, through June 30, 2016 as the impact was immaterial. The Company's consolidated statement of operations for the year ended September 30, 2016 includes Visa Europe's financial results for the three months ended September 30, 2016. See Note 2—Acquisition of Visa Europe. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Sep. 30, 2016 | |
Accounting Policies [Abstract] | |
Summary of Significant Accounting Policies | Note 1—Summary of Significant Accounting Policies Organization . In a series of transactions from October 1 to October 3, 2007, Visa Inc. (Visa or the Company) undertook a reorganization in which Visa U.S.A. Inc. (Visa U.S.A.), Visa International Service Association (Visa International), Visa Canada Corporation (Visa Canada) and Inovant LLC (Inovant) became direct or indirect subsidiaries of Visa and established the U.S. retrospective responsibility plan (the October 2007 reorganization or reorganization). See Note 3—U.S. and Europe Retrospective Responsibility Plans . The reorganization was reflected as a single transaction on October 1, 2007 using the purchase method of accounting with Visa U.S.A. as the accounting acquirer. Visa Europe Limited (Visa Europe) did not become a subsidiary of Visa Inc., but rather remained owned and governed by its European member financial institutions. On June 21, 2016, the Company acquired 100% of the share capital of Visa Europe. The Company's consolidated statements of operations do not reflect the financial results of Visa Europe for the 10 days from the acquisition date through June 30, 2016 as the impact was immaterial. See Note 2—Acquisition of Visa Europe . Visa is a global payments technology company that connects consumers, merchants, financial institutions, businesses, strategic partners and governments in more than 200 countries and territories to fast, secure and reliable electronic payments. Visa and its wholly-owned consolidated subsidiaries, including Visa U.S.A., Visa International, Visa Worldwide Pte. Limited (VWPL), Visa Europe Limited (Visa Europe), Visa Canada, Inovant and CyberSource Corporation (CyberSource), operate one of the world's largest retail electronic payments network — VisaNet — which facilitates authorization, clearing and settlement of payment transactions and enables us to provide our financial institution and merchant clients a wide range of products, platforms and value-added services. VisaNet also offers fraud protection for account holders and assured payment for merchants. Visa is not a bank and does not issue cards, extend credit or set rates and fees for account holders on Visa products. In most cases, account holder and merchant relationships belong to, and are managed by, Visa's financial institution clients. Consolidation and basis of presentation . The consolidated financial statements include the accounts of Visa and its consolidated entities and are presented in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). The Company consolidates its majority-owned and controlled entities, including variable interest entities (“VIEs”) for which the Company is the primary beneficiary. The Company's investments in VIEs have not been material to its consolidated financial statements as of and for the periods presented. All significant intercompany accounts and transactions are eliminated in consolidation. On March 18, 2015, the Company completed a four -for-one split of its class A common stock effected in the form of a stock dividend. All per share amounts and number of shares outstanding in the consolidated financial statements and accompanying notes are presented on a post-split basis. See Note 14—Stockholders' Equity . The Company's activities are interrelated, and each activity is dependent upon and supportive of the other. All significant operating decisions are based on analysis of Visa as a single global business. Accordingly, the Company has one reportable segment, Payment Services. Use of estimates . The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions about future events. These estimates and assumptions affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and reported amounts of revenues and expenses during the reporting period. Future actual results could differ materially from these estimates. The use of estimates in specific accounting policies is described further below as appropriate. Cash and cash equivalents . Cash and cash equivalents include cash and certain highly liquid investments with original maturities of 90 days or less from the date of purchase. Cash equivalents are primarily recorded at cost, which approximates fair value due to their generally short maturities. Restricted cash—U.S. litigation escrow . The Company maintains an escrow account from which monetary liabilities from settlements of, or judgments in, the U.S. covered litigation are paid. See Note 3—U.S. and Europe Retrospective Responsibility Plans and Note 20—Legal Matters for a discussion of the U.S. covered litigation. The escrow funds are held in money market investments, together with the interest earned, less applicable taxes payable, and classified as restricted cash on the consolidated balance sheets. Interest earned on escrow funds is included in non-operating income on the consolidated statements of operations. Investments and fair value. The Company measures certain assets and liabilities at fair value. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value measurements are reported under a three-level valuation hierarchy. See Note 4—Fair Value Measurements and Investments . The classification of the Company’s financial assets and liabilities within the hierarchy is as follows: Level 1 —Inputs to the valuation methodology are unadjusted quoted prices in active markets for identical assets or liabilities. The Company’s Level 1 assets include money market funds, publicly-traded equity securities and U.S. Treasury securities. Level 2 —Inputs to the valuation methodology can include: (1) quoted prices in active markets for similar (not identical) assets or liabilities; (2) quoted prices for identical or similar assets in non-active markets; (3) inputs other than quoted prices that are observable for the asset or liability; or (4) inputs that are derived principally from or corroborated by observable market data. The Company's Level 2 assets and liabilities include commercial paper, U.S. government-sponsored debt securities, corporate debt securities and foreign exchange derivative instruments. Level 3 —Inputs to the valuation methodology are unobservable and cannot be corroborated by observable market data. The Company's Level 3 assets and liabilities included auction rate securities and the Visa Europe put option at September 30, 2015. Trading investment securities include mutual fund equity security investments related to various employee compensation and benefit plans. Trading activity in these investments is at the direction of the Company's employees. These investments are held in a trust and are not available for the Company's operational or liquidity needs. Interest and dividend income and changes in fair value are recorded in non-operating income, and offset in personnel expense on the consolidated statements of operations. Available-for-sale investment securities include investments in debt and equity securities. These securities are recorded at cost at the time of purchase and are carried at fair value. The Company considers these securities to be available-for-sale to meet working capital and liquidity needs. Investments with original maturities of greater than 90 days and stated maturities of less than one year from the balance sheet date, or investments that the Company intends to sell within one year, are classified as current assets, while all other securities are classified as non-current assets. These investments are generally available to meet short-term liquidity needs. Unrealized gains and losses are reported in accumulated other comprehensive income or loss on the consolidated balance sheets until realized. The specific identification method is used to calculate realized gain or loss on the sale of marketable securities, which is recorded in non-operating income on the consolidated statements of operations. Dividend and interest income are recognized when earned and are included in non-operating income on the consolidated statements of operations. The Company evaluates its debt and equity securities for other-than-temporary impairment, or OTTI, on an ongoing basis. When there has been a decline in fair value of a debt or equity security below the amortized cost basis, the Company recognizes OTTI if: (1) it has the intent to sell the security; (2) it is more likely than not that it will be required to sell the security before recovery of the amortized cost basis; or (3) it does not expect to recover the entire amortized cost basis of the security. The Company applies the equity method of accounting for investments in other entities when it holds between 20% and 50% ownership in the entity or when it exercises significant influence. Under the equity method, the Company’s share of each entity’s profit or loss is reflected in non-operating income on the consolidated statements of operations. The equity method of accounting is also used for flow-through entities such as limited partnerships and limited liability companies when the investment ownership percentage is equal to or greater than 5% of outstanding ownership interests, regardless of whether the Company has significant influence over the investees. The Company applies the cost method of accounting for investments in other entities when it holds less than 20% ownership in the entity and does not exercise significant influence, or for flow-through entities when the investment ownership is less than 5% and the Company does not exercise significant influence. These investments consist of equity holdings in non-public companies and are recorded in other assets on the consolidated balance sheets. The Company regularly reviews investments accounted for under the cost and equity methods for possible impairment, which generally involves an analysis of the facts and changes in circumstances influencing the investment, expectations of the entity’s cash flows and capital needs, and the viability of its business model. Financial instruments . The Company considers the following to be financial instruments: cash and cash equivalents, restricted cash-U.S. litigation escrow, trading and available-for-sale investment securities, settlement receivable and payable, customer collateral, non-marketable equity investments, settlement risk guarantee, and derivative instruments. See Note 4—Fair Value Measurements and Investments . Settlement receivable and payable . The Company operates systems for authorizing, clearing and settling payment transactions worldwide. Most U.S. dollar settlements with the Company's financial institution clients are settled within the same day and do not result in a receivable or payable balance, while settlements in currencies other than the U.S. dollar generally remain outstanding for one to two business days, resulting in amounts due from and to clients.These amounts are presented as settlement receivable and settlement payable on the consolidated balance sheets. Customer collateral . The Company holds cash deposits and other non-cash assets from certain clients in order to ensure their performance of settlement obligations arising from Visa payment products are processed in accordance with the Company's rules. The cash collateral assets are restricted and fully offset by corresponding liabilities and both balances are presented on the consolidated balance sheets, excluding cash collateral held by Visa Europe as its clients retain beneficial ownership and the cash is only accessible to the Company in the event of default by the client on its settled obligations. Non-cash collateral assets are held on behalf of the Company by a third party and are not recorded on the consolidated balance sheets. See Note 11—Settlement Guarantee Management . Property, equipment and technology, net . Property, equipment and technology are recorded at historical cost less accumulated depreciation and amortization, which are computed on a straight-line basis over the asset’s estimated useful life. Depreciation and amortization of technology, furniture, fixtures and equipment are computed over estimated useful lives ranging from 2 to 10 years. Capital leases are amortized over the lease term and leasehold improvements are amortized over the shorter of the useful life of the asset or lease term. Building improvements are depreciated between 3 and 40 years, and buildings are depreciated over 40 years. Improvements that increase functionality of the asset are capitalized and depreciated over the asset’s remaining useful life. Land and construction-in-progress are not depreciated. Fully depreciated assets are retained in property, equipment and technology, net, until removed from service. Technology includes purchased and internally developed software, including technology assets obtained through acquisitions. Internally developed software represents software primarily used by the VisaNet electronic payments network. Internal and external costs incurred during the preliminary project stage are expensed as incurred. Qualifying costs incurred during the application development stage are capitalized. Once the project is substantially complete and ready for its intended use these costs are amortized on a straight-line basis over the technology's estimated useful life. Acquired technology assets are initially recorded at fair value and amortized on a straight-line basis over the estimated useful life. The Company evaluates the recoverability of long-lived assets for impairment annually or more frequently if events or changes in circumstances indicate that the carrying amount of an asset or asset group may not be recoverable. If the sum of expected undiscounted net future cash flows is less than the carrying amount of an asset or asset group, an impairment loss is recognized to the extent that the carrying amount of the asset or asset group exceeds its fair value. See Note 6—Property, Equipment and Technology, Net . Leases . The Company enters into operating and capital leases for the use of premises, software and equipment. Rent expense related to operating lease agreements, which may or may not contain lease incentives, is primarily recorded on a straight-line basis over the lease term. Intangible assets, net . The Company records identifiable intangible assets at fair value on the date of acquisition and evaluates the useful life of each asset. Finite-lived intangible assets primarily consist of customer relationships, reacquired rights, reseller relationships and trade names obtained through acquisitions. Finite-lived intangible assets are amortized on a straight-line basis and are tested for recoverability if events or changes in circumstances indicate that their carrying amounts may not be recoverable. These intangibles have useful lives ranging from 3 to 15 years. No events or changes in circumstances indicate that impairment existed as of September 30, 2016 . See Note 7—Intangible Assets and Goodwill . Indefinite-lived intangible assets consist of trade name, customer relationships and reacquired rights. Intangible assets with indefinite useful lives are not amortized but are evaluated for impairment annually or more frequently if events or changes in circumstances indicate that impairment may exist. The Company first assesses qualitative factors to determine whether it is necessary to perform a quantitative impairment test for indefinite-lived intangible assets. The Company assesses each category of indefinite-lived intangible assets for impairment on an aggregate basis, which may require the allocation of cash flows and/or an estimate of fair value to the assets or asset group. Impairment exists if the fair value of the indefinite-lived intangible asset is less than the carrying value. The Company relies on a number of factors when completing impairment assessments, including a review of discounted net future cash flows, business plans and the use of present value techniques. The Company completed its annual impairment review of indefinite-lived intangible assets as of February 1, 2016 , and concluded there was no impairment as of that date. No recent events or changes in circumstances indicate that impairment of the Company's indefinite-lived intangible assets existed as of September 30, 2016 . Goodwill . Goodwill represents the excess of the purchase price over the fair value of the net assets acquired in a business combination. Goodwill is not amortized but is evaluated for impairment at the reporting unit level annually as of February 1, or more frequently if events or changes in circumstances indicate that impairment may exist. The Company evaluated its goodwill for impairment on February 1, 2016 , and concluded there was no impairment as of that date. No recent events or changes in circumstances indicate that impairment existed as of September 30, 2016 . Accrued litigation . The Company evaluates the likelihood of an unfavorable outcome in legal or regulatory proceedings to which it is a party and records a loss contingency when it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. These judgments are subjective, based on the status of such legal or regulatory proceedings, the merits of the Company's defenses and consultation with corporate and external legal counsel. Actual outcomes of these legal and regulatory proceedings may differ materially from the Company's estimates. The Company expenses legal costs as incurred in professional fees in the consolidated statements of operations. See Note 20—Legal Matters . Revenue recognition . The Company's operating revenues are comprised principally of service revenues, data processing revenues, international transaction revenues and other revenues, reduced by costs incurred under client incentives arrangements. The Company recognizes revenue, net of sales and other similar taxes, when the price is fixed or determinable, persuasive evidence of an arrangement exists, the service is performed and collectability of the resulting receivable is reasonably assured. Service revenues consist of revenues earned for services provided in support of client usage of Visa products. Current quarter service revenues are primarily assessed using a calculation of current pricing applied to the prior quarter's payments volume. The Company also earns revenues from assessments designed to support ongoing acceptance and volume growth initiatives, which are recognized in the same period the related volume is transacted. Data processing revenues consist of revenues earned for authorization, clearing, settlement, network access and other maintenance and support services that facilitate transaction and information processing among the Company's clients globally. Data processing revenues are recognized in the same period the related transactions occur or services are rendered. International transaction revenues are earned for cross-border transaction processing and currency conversion activities. Cross-border transactions arise when the country of origin of the issuer is different from that of the merchant. International transaction revenues are primarily generated by cross-border payments and cash volume. Other revenues consist mainly of license fees for use of the Visa brand, revenues earned from Visa Europe in connection with the Visa Europe Framework Agreement (see Note 2—Acquisition of Visa Europe ) prior to the acquisition of Visa Europe, fees for account holder services, licensing and certification and other activities related to the Company's acquired entities. Other revenues also include optional service or product enhancements, such as extended account holder protection and concierge services. Other revenues are recognized in the same period the related transactions occur or services are rendered. Client incentives. The Company enters into long-term contracts with financial institution clients, merchants and strategic partners for various programs designed to build payments volume, increase Visa product acceptance, win merchant routing transactions over Visa's network and drive innovation. These incentives are primarily accounted for as reductions to operating revenues or as operating expenses if a separate identifiable benefit at fair value can be established. The Company generally capitalizes advance incentive payments under these agreements if select criteria are met. The capitalization criteria include the existence of future economic benefits to Visa, the existence of legally enforceable recoverability language (e.g., early termination clauses), management's ability and intent to enforce the recoverability language and the ability to generate future earnings from the agreement in excess of amounts deferred. Capitalized amounts are amortized over the shorter of the period of contractual recoverability or the corresponding period of economic benefit. Incentives not yet paid are accrued systematically and rationally based on management's estimate of each client's performance. These accruals are regularly reviewed and estimates of performance are adjusted, as appropriate, based on changes in performance expectations, actual client performance, amendments to existing contracts or the execution of new contracts. See Note 17—Commitments and Contingencies . Marketing. The Company expenses costs for the production of advertising as incurred. The cost of media advertising is expensed when the advertising takes place. Sponsorship costs are recognized over the period in which the Company benefits from the sponsorship rights. Promotional items are expensed as incurred, when the related services are received, or when the related event occurs. Income taxes . The Company's income tax expense consists of two components: current and deferred. Current income tax expense represents taxes paid or payable for the current period. Deferred tax assets and liabilities are recognized to reflect the future tax consequences attributable to temporary differences between the financial statement carrying amounts and the respective tax basis of existing assets and liabilities, and operating loss and credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. In assessing whether deferred tax assets are realizable, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. A valuation allowance is recorded for the portions that are not expected to be realized based on the level of historical taxable income, projections of future taxable income over the periods in which the temporary differences are deductible, and qualifying tax planning strategies. Where interpretation of the tax law may be uncertain, the Company recognizes, measures and discloses income tax uncertainties. The Company accounts for interest expense and penalties related to uncertain tax positions as non-operating expense in the consolidated statements of operations. The Company files a consolidated federal income tax return and, in certain states, combined state tax returns. The Company elects to claim foreign tax credits in any given year if such election is beneficial to the Company. See Note 19—Income Taxes . Pension and other postretirement benefit plans . The Company’s defined benefit pension and other postretirement benefit plans are actuarially evaluated, incorporating various critical assumptions including the discount rate and the expected rate of return on plan assets (for qualified pension plans). The discount rate is based on a cash flow matching analysis, with the projected benefit payments matching spot rates from a yield curve developed from high-quality corporate bonds. The expected rate of return on pension plan assets considers the current and expected asset allocation, as well as historical and expected returns on each plan asset class. Any difference between actual and expected plan experience, including asset return experience, in excess of a 10% corridor is recognized in net periodic pension cost over the expected average employee future service period, which is approximately 9 years for the U.S. plans and 12 years for the Visa Europe U.K. pension plan. Other assumptions involve demographic factors such as retirement age, mortality, attrition and the rate of compensation increases. The Company evaluates assumptions annually and modifies them as appropriate. The Company recognizes the funded status of its benefit plans in its consolidated balance sheets as other assets, accrued liabilities and other liabilities. The Company recognizes settlement losses when it settles pension benefit obligations, including making lump-sum cash payments to plan participants in exchange for their rights to receive specified pension benefits, when certain thresholds are met. See Note 10—Pension, Postretirement and Other Benefits . Foreign currency remeasurement and translation . The Company's functional currency is the U.S. dollar for the majority of its foreign operations except for Visa Europe whose functional currency is the euro. Transactions denominated in currencies other than the applicable functional currency are converted to the functional currency at the exchange rate on the transaction date. At period end, monetary assets and liabilities are remeasured to the functional currency using exchange rates in effect at the balance sheet date. Non-monetary assets and liabilities are remeasured at historical exchange rates. Resulting foreign currency transaction gains and losses related to conversion and remeasurement are recorded in general and administrative expense in the consolidated statements of operations and were not material for fiscal 2016, 2015 and 2014. Where a non-U.S. currency is the functional currency, translation from that functional currency to the U.S. dollar is performed for balance sheet accounts using exchange rates in effect at the balance sheet date and for revenue and expense accounts using an average exchange rate for the period. Resulting translation adjustments are reported as a component of accumulated other comprehensive income or loss on the consolidated balance sheets. Derivative financial instruments . The Company uses foreign exchange forward derivative contracts to reduce its exposure to foreign currency rate changes on forecasted non-functional currency denominated operational cash flows. Derivatives are carried at fair value on a gross basis in either prepaid and other current assets or accrued liabilities on the consolidated balance sheets. At September 30, 2016, derivatives outstanding mature within 18 months or less. Gains and losses resulting from changes in fair value of designated derivative instruments are accounted for either in accumulated other comprehensive income or loss on the consolidated balance sheets, or in the consolidated statements of operations in the corresponding account where revenue or expense is hedged, or to general and administrative for hedge amounts determined to be ineffective. Gains and losses resulting in changes in fair value of derivative instruments not designated for hedge accounting are recorded in general and administrative for hedges of operating activity, or non-operating income (expense) for hedges of non-operating activity. See Note 12—Derivative and Non-derivative Financial Instruments . Non-derivative financial instrument designated as a net investment hedge. The Company designated the euro-denominated deferred cash consideration liability, a non-derivative financial instrument, as a hedge against a portion of the Company's euro-denominated net investment in Visa Europe. See Note 2—Acquisition of Visa Europe . Changes in the value of the deferred cash consideration liability, attributable to the change in exchange rates at the end of each reporting period, partially offset the foreign currency translation adjustments resulting from the euro-denominated net investment, are reported as a component of accumulated other comprehensive income or loss on the Company's consolidated balance sheet. See Note 12—Derivative and Non-derivative Financial Instruments . Guarantees and indemnifications . The Company recognizes an obligation at inception for guarantees and indemnifications that qualify for recognition, regardless of the probability of occurrence. The Company indemnifies its financial institution clients for settlement losses suffered due to the failure of any other client to fund its settlement obligations in accordance with the Visa Rules. The estimated fair value of the liability for settlement indemnification is included in accrued liabilities on the consolidated balance sheets and is described in Note 11—Settlement Guarantee Management . Share-based compensation . The Company recognizes share-based compensation cost using the fair value method of accounting. The Company recognizes compensation cost for awards with only service conditions on a straight-line basis over the requisite service period, which is generally the vesting period. Compensation cost for performance and market-condition-based awards is recognized on a graded-vesting basis. The amount is initially estimated based on target performance and is adjusted as appropriate based on management's best estimate throughout the performance period. See Note 16—Share-based Compensation . Earnings per share . The Company calculates earnings per share using the two-class method to reflect the different rights of each class and series of outstanding common stock. The dilutive effect of incremental common stock equivalents is reflected in diluted earnings per share by application of the treasury stock method. See Note 15—Earnings Per Share . Recently Issued Accounting Pronouncements In May 2014, the Financial Accounting Standards Board ("FASB") issued ASU No. 2014-09, which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of goods or services to customers. The ASU will replace existing revenue recognition guidance in U.S. GAAP when it becomes effective. In August 2015, the FASB issued ASU No. 2015-14, which defers the effective date of ASU No. 2014-09 by one year. In March 2016, the FASB issued ASU 2016-08, which clarifies the implementation guidance on principal versus agent considerations under the new revenue recognition standard. In April 2016, the FASB issued ASU 2016-10, which clarifies the implementation guidance on identifying promised goods or services and on determining whether an entity's promise to grant a license with either a right to use the entity's intellectual property (which is satisfied at a point in time) or a right to access the entity's intellectual property (which is satisfied over time). In May 2016, the FASB issued ASU 2016-11, which rescinds certain SEC staff observer comments upon adoption of ASU 2014-09, including the SEC comments related to consideration given by a vendor to a customer. In May 2016, the FASB also issued ASU 2016-12, which provides narrow scope improvements and technical expedients on assessing collectibility, presentation of sales taxes, evaluating contract modifications and completed contracts at the time of transition and the disclosure requirement for the effect of the accounting change for the period of adoption.The Company will adopt the standard effective October 1, 2018. The standard permits the use of either the retrospective or cumulative effect transition method. The Company has not yet selected a transition method and is evaluating the full effect that ASU 2014-09 and all of its related subsequent updates will have on its consolidated financial statements and related disclosures. In June 2014, the FASB issued ASU No. 2014-12, which requires a performance target in stock compensation awards that affects vesting, and is achievable after the requisite service period, be treated as a performance condition. The Company will adopt the standard effective October 1, 2016. The adoption is not expected to have a material impact on the consolidated financial statements. In April 2015, the FASB issued ASU No. 2015-03, which simplifies the presentation of debt issuance costs by requiring that debt issuance costs be presented in the balance sheet as a direc |
Visa Europe
Visa Europe | 12 Months Ended |
Sep. 30, 2016 | |
Business Combinations [Abstract] | |
Visa Europe | Note 2—Acquisition of Visa Europe On June 21, 2016, the Company acquired 100% of the share capital of Visa Europe, a payments technology business. The acquisition positions Visa to create additional value through increased scale, efficiencies realized by the integration of both businesses, and benefits related to Visa Europe's transition from an association to a for-profit enterprise. At the closing of the transaction (the "Closing"), the Company: • paid up-front cash consideration of € 12.2 billion ( $13.9 billion ); • issued preferred stock of the Company convertible upon certain conditions into approximately 79 million shares of class A common stock of the Company, as described below, equivalent to a value of € 5.3 billion ( $6.1 billion ) at the closing stock price of $77.33 on June 21, 2016; and • agreed to pay an additional € 1.0 billion , plus 4% compound annual interest, on the third anniversary of the Closing. Preferred stock . In connection with the transaction, three new series of preferred stock of the Company were created: • series A convertible participating preferred stock, par value $0.0001 per share, which is generally designed to be economically equivalent to the Company’s class A common stock (the “class A equivalent preferred stock”); • series B convertible participating preferred stock, par value $0.0001 per share (the “U.K.&I preferred stock”); and • series C convertible participating preferred stock, par value $0.0001 per share (the “Europe preferred stock”). The Company issued 2,480,466 shares of U.K.&I preferred stock to Visa Europe’s member financial institutions in the United Kingdom and Ireland entitled to receive preferred stock at the Closing, and 3,156,823 shares of Europe preferred stock to Visa Europe’s other member financial institutions entitled to receive preferred stock at the Closing. Under certain conditions described below, the U.K.&I and Europe preferred stock is convertible into shares of class A common stock or class A equivalent preferred stock, at an initial conversion rate of 13.952 shares of class A common stock for each share of U.K.&I preferred stock and Europe preferred stock. The conversion rates may be reduced from time to time to offset certain liabilities, if any, which may be incurred by the Company, Visa Europe or their affiliates as a result of certain existing and potential litigation relating to the setting of multilateral interchange fee rates in the Visa Europe territory (the "VE territory covered litigation"), where, generally, the relevant claims (and resultant liabilities and losses) relate to the period before the Closing. Only seventy percent of such liabilities may be offset where the liability arises from a claim related to inter-regional multilateral interchange fees applied to transactions where the issuer is located outside the Visa Europe territory while the merchant outlet is located within the Visa Europe territory. A reduction in the conversion rates of the U.K.&I preferred stock and the Europe preferred stock have the same economic effect on diluted class A common stock earnings per share as repurchasing the Company's class A common stock because it reduces the as-converted class A common stock share count. Additionally, the shares of U.K.&I and Europe preferred stock are subject to restrictions on transfer and may become convertible in stages based on developments in the VE territory covered litigation. The shares of U.K.&I and Europe preferred stock will become fully convertible on the 12th anniversary of the Closing, subject only to a holdback to cover any then-pending claims. Upon any such conversion of the U.K.&I or Europe preferred stock (whether by such 12th anniversary, or thereafter with respect to claims pending on such anniversary), the holder would receive either class A common stock or class A equivalent preferred stock (for those who are not eligible to hold class A common stock pursuant to the Company's charter). The class A equivalent preferred stock will be freely transferable and each share of class A equivalent preferred stock will automatically convert into 100 shares of class A common stock upon a transfer to any holder that is eligible to hold class A common stock under the charter. See Note 3—U.S. and Europe Retrospective Responsibility Plans . The holders of the U.K.&I and Europe preferred stock have no right to vote on any matters, except for certain defined matters, including, in specified circumstances, any consolidation, merger or combination of the Company. Holders of the class A equivalent preferred stock, upon issuance at conversion, will have similar voting rights to the rights of the holders of the U.K.&I and Europe preferred stock. With respect to those limited matters on which the holders of preferred stock may vote, approval by the holders of the preferred stock requires the affirmative vote of the outstanding voting power of each such series of preferred stock, each such series voting as a single class. Upon issuance, all three series of preferred stock will participate on an as-converted basis in regular quarterly cash dividends declared on the Company's class A common stock. U.K. loss sharing agreement . On November 2, 2015, the Company, Visa Europe and certain of Visa Europe’s member financial institutions located in the United Kingdom (the “U.K. LSA members”) entered into a loss sharing agreement (the “U.K. loss sharing agreement”). Each of the U.K. LSA members has agreed, on a several and not joint basis, to compensate the Company for certain losses which may be incurred by the Company, Visa Europe or their affiliates as a result of certain existing and potential litigation relating to the setting and implementation of domestic multilateral interchange fee rates in the United Kingdom prior to the Closing (the "U.K. covered claims"), subject to the terms and conditions set forth therein and, with respect to each U.K. LSA member, up to a maximum amount of the up-front cash consideration received by such U.K. LSA member. The U.K. LSA members’ obligations under the U.K. loss sharing agreement are conditional upon, among other things, either (a) losses valued in excess of the sterling equivalent at the Closing of € 1.0 billion having arisen in U.K covered claims (and such losses having reduced the conversion rate of the U.K.&I preferred stock accordingly), or (b) the conversion rate of the U.K.&I preferred stock having been reduced to zero pursuant to losses arising in claims relating to multilateral interchange fee rate setting in the Visa Europe territory. See Note 3—U.S. and Europe Retrospective Responsibility Plans . Litigation management deed . On June 21, 2016, the Company and Visa Europe entered into a litigation management deed (the "litigation management deed"), which sets forth the agreed upon procedures for the management of the VE territory covered litigation, the allocation of losses resulting from the VE territory covered litigation ("VE territory covered losses") between the U.K.&I and Europe preferred stock, and any accelerated conversion or reduction in the conversion rate of the shares of U.K.&I and Europe preferred stock. The litigation management deed applies only to VE territory covered litigation (and resultant losses and liabilities). Subject to the terms and conditions set forth therein, the litigation management deed provides that the Company will generally control the conduct of the VE territory covered litigation, subject to certain obligations to report and consult with the newly established litigation management committees for VE territory covered litigation ("VE territory litigation management committees"). The VE territory litigation management committees, which are composed of representatives of certain Visa Europe members, have also been granted consent rights to approve certain material decisions in relation to the VE territory covered litigation. Framework Agreement. In connection with the Company's October 2007 reorganization, the Company granted to Visa Europe exclusive, irrevocable and perpetual licenses to use the Visa trademarks and technology intellectual property owned by the Company and certain affiliates within the Visa Europe region for use in the field of financial services, payments, related information technology and information processing services and participation in the Visa system (the "Framework Agreement"). We recorded $191 million , $255 million and $226 million of revenue in accordance with the Framework Agreement during fiscal 2016, 2015 and 2014, respectively. As a result of the acquisition, the fee recognized in fiscal year 2016 was pro-rated for the period prior to the Closing, and no fees related to the Framework Agreement were recognized in the three months ended September 30, 2016, nor will they be recognized in future periods. Acquisition-related costs. The Company incurred $152 million of non-recurring operating expense during fiscal 2016 . This amount is comprised of $60 million of transaction expenses recorded in professional fees, and $92 million of expense related to U.K. stamp duty, which was recorded in general and administrative expenses. Accounting treatment for the acquisition. The following table details the purchase consideration: Accounting Purchase Consideration (in millions) Cash payment $ 13,882 Fair value of preferred stock (1) 5,692 Total upfront consideration $ 19,574 Fair value of deferred cash consideration (2) 1,236 Total consideration before adjustments $ 20,810 Less: Visa Europe Framework Agreement loss (3) (1,856 ) Less: Treasury stock (4) (170 ) Total accounting purchase consideration $ 18,784 (1) The fair value of preferred stock was determined based on its as-converted value of $6.1 billion on June 21, 2016, less a 6% discount for illiquidity as these shares are subject to limitations on transferability. The fair value was also adjusted to reflect $25 million of "right to recover for covered losses" related to VE territory covered losses prior to the Closing. See Note 20—Legal Matters . (2) This amount reflects the fair value of deferred cash consideration of € 1.0 billion , plus 4.0% compound annual interest, payable on the third anniversary of the Closing, discounted at a rate of 1.2% . At September 30, 2016, the deferred consideration of $1.2 billion reflects interest accretion recognized during the three months ended September 30, 2016, more than offset by the impact of changes in the euro to U.S. dollar exchange rate from the Closing. Total consideration has been adjusted to account for the following items to arrive at the accounting purchase consideration: (3) the loss upon consummation of the transaction resulting from the effective settlement of the Framework Agreement between Visa and Visa Europe. The Visa Europe Framework Agreement provided Visa Europe with a perpetual, exclusive right to operate the Visa business in the Visa Europe region in exchange for a license fee paid to Visa. Under the terms of the Framework Agreement, the license fee paid by Visa Europe has increased modestly since inception in 2007, while the value of the Visa Europe business has increased at a greater rate. Using an income approach, the Company assessed the contractual terms and conditions of the Framework Agreement as compared to current market conditions and the historical and expected financial performance of Visa Europe. Based on the analysis performed, the Company determined that the terms were not at fair value as determined under U.S. GAAP at the Closing. The present value of the expected differential between payments required by the Framework Agreement and those that would be required if the contract were at fair value under U.S. GAAP was calculated over the Framework Agreement's contractual perpetual term, resulting in a loss of $1.9 billion recognized within operating expense in the Company's consolidated statement of operations during the third quarter of fiscal 2016, and a reduction to the purchase accounting consideration; and (4) the fair value of the Visa class C common stock held by Visa Europe as of the Closing. Total purchase consideration has been allocated to the tangible and identifiable intangible assets acquired and liabilities assumed based on a preliminary valuation as we continue to gather additional information necessary to finalize the valuation. These preliminary values may further change in future reporting periods until finalization of the valuation, which will occur no later than the third quarter of fiscal 2017. The following table summarizes the preliminary purchase price allocation. Preliminary Purchase Price Allocation (in millions) Current assets (1) $ 4,457 Non-current assets (2) 258 Current liabilities (3) (2,731 ) Non-current liabilities (2) (2,605 ) Tangible assets and liabilities $ (621 ) Intangible assets — customer relationships and reacquired rights (2) 16,137 Goodwill (4) 3,268 Fair value of net assets acquired $ 18,784 (1) Current assets are largely comprised of cash and cash equivalents and settlement receivable. (2) Intangible assets consist of customer relationships and reacquired rights, which have been valued as a single composite intangible asset as they are inextricably linked. These intangibles are considered indefinite-lived assets as the associated customer relationships have historically not experienced significant attrition, and the reacquired rights are based on the Framework Agreement, which has a perpetual term. Non-current assets and liabilities include deferred tax assets and liabilities that result in net deferred tax liabilities of $2.4 billion , which are primarily related to these indefinite-lived intangible assets, and are not expected to be realized in the foreseeable future. (3) Current liabilities assumed mainly include settlement payable, client incentives liabilities and accrued liabilities. (4) The excess of purchase consideration over net assets acquired was recorded as goodwill, which represents the value that is expected from increased scale and synergies as a result of the integration of both businesses. Actual and pro forma impact of acquisition. The Company did not include Visa Europe's financial results in the Company's consolidated statements of operations from the acquisition date, June 21, 2016, through June 30, 2016 as the impact was immaterial. Total consolidated Visa Inc. net revenue for the fiscal year ended September 30, 2016 includes $554 million from Visa Europe's operations for the three months ended September 30, 2016. Had the Company not acquired Visa Europe, approximately $65 million of revenue would have been recorded under the Framework Agreement during the fourth quarter of fiscal 2016. Therefore, the acquisition of Visa Europe resulted in a net increase of $489 million in net revenue. Total consolidated Visa Inc. net income for the fiscal year ended September 30, 2016 includes $299 million from Visa Europe's operations for the three months ended September 30, 2016. This includes the non-cash, non-recurring $88 million tax benefit upon remeasurement of a deferred tax liability to reflect a tax rate change in the United Kingdom. In connection with the acquisition, Visa Inc. recorded several significant items that would not have been incurred had we not acquired Visa Europe. Therefore, the acquisition of Visa Europe reduced Visa Inc. fiscal year 2016 consolidated net income by approximately $872 million , as follows: Impact of Visa Europe acquisition on fiscal 2016 consolidated net income: (in millions) Visa Europe net income included in consolidated net income $ 299 Less approximately $65 million of revenue that would have been recorded by Visa Inc. under the Framework Agreement, net of tax (41 ) Less acquisition-related expense recorded by Visa Inc., net of tax, upon: Effective settlement of the Framework Agreement (1,184 ) Interest expense incurred on $16.0 billion debt, net of interest income earned (243 ) Transaction costs incurred (96 ) Add acquisition-related gains recorded by Visa Inc., net of tax, upon: Revaluation of Visa Europe put option 255 Remeasurement of euro deposits 91 Remeasurement of currency forward contracts 47 Total impact of Visa Europe acquisition on consolidated net income $ (872 ) The following table presents supplemental pro forma information as if the acquisition and related issuance of senior notes had occurred on October 1, 2014. The pro forma financial information is not necessarily indicative of the Company's consolidated results of operations that would have been realized had the acquisition been completed on October 1, 2014, nor does it purport to project the future results of operations of the combined company or reflect any reorganizations, or cost or other operating synergies that may occur subsequent to the Closing. The actual results of operations of the combined company may differ significantly from the pro forma results presented here due to many factors. Pro Forma Consolidated Results Fiscal 2016 Fiscal 2015 (in millions, except per share data) Total operating revenues $ 16,090 $ 15,425 Net income $ 7,072 $ 5,210 Diluted earnings per share $ 2.93 $ 2.06 The pro forma financial information above reflects the following material pro forma adjustments: • conversion of Visa Europe's historical results of operations from euro to U.S. dollar, and from International Financial Reporting Standards to U.S. GAAP; • elimination of transactions between Visa and Visa Europe upon consolidation, primarily related to annual license and various other fees paid by Visa Europe to Visa in accordance with the Framework Agreement; • an increase in non-operating expense for additional interest expense and amortization of debt issuance costs resulting from the issuance of the $16.0 billion senior notes; • exclusion of a $255 million gain in the twelve months ended September 30, 2016 and $110 million loss in the twelve months ended September 30, 2015 related to the revaluation of the Visa Europe put option (1) ; and • the inclusion of non-recurring amounts on October 1, 2014, the date the acquisition is presumed to have occurred for purposes of presenting pro forma results, and a corresponding reduction of these amounts in the period originally recognized, as follows: ◦ $1.9 billion Visa Europe Framework Agreement loss related to the effective settlement of the Framework Agreement recognized in the twelve months ended September 30, 2016; ◦ $152 million of acquisition-related costs for the twelve months ended September 30, 2016; ◦ $145 million of foreign exchange gains related to euros held during the twelve months ended September 30, 2016; and ◦ $74 million of gains for the twelve months ended September 30, 2016 related to currency forward contracts entered into to mitigate a portion of the foreign currency exchange rate risk associated with the upfront cash consideration. (1) For purposes of preparing this pro forma financial information, the fair value of the Visa Europe put option is presumed to have been reduced to zero prior to October 1, 2014. Therefore, gains or losses associated with changes in the fair value of the Visa Europe put option liability are not included in pro forma net income for either period presented. The pro forma results also reflect the applicable tax impact of the pro forma adjustments. The taxes associated with the adjustments reflect the statutory tax rate in effect during the respective periods. |
U.S. and Europe Retrospective R
U.S. and Europe Retrospective Responsibility Plan | 12 Months Ended |
Sep. 30, 2016 | |
Retrospective Responsibility Plan [Abstract] | |
U.S. and Europe Retrospective Responsibility Plan | Note 3—U.S. and Europe Retrospective Responsibility Plans U.S. Retrospective Responsibility Plan The Company has established several related mechanisms designed to address potential liability under certain litigation referred to as the “U.S. covered litigation." These mechanisms are included in and referred to as the U.S. retrospective responsibility plan and consist of a U.S. litigation escrow agreement, the conversion feature of the Company's shares of class B common stock, the indemnification obligations of the Visa U.S.A. members, an interchange judgment sharing agreement, a loss sharing agreement and an omnibus agreement, as amended. U.S. covered litigation consists of a number of matters that have been settled or otherwise fully or substantially resolved, as well as the following: • the Interchange Multidistrict Litigation . In re Payment Card Interchange Fee and Merchant Discount Antitrust Litigation, 1:05-md-01720-JG-JO (E.D.N.Y.) or MDL 1720, including all cases currently included in MDL 1720, any other case that includes claims for damages relating to the period prior to the Company's IPO that has been or is transferred for coordinated or consolidated pre-trial proceedings at any time to MDL 1720 by the Judicial Panel on Multidistrict Litigation or otherwise included at any time in MDL 1720 by order of any court of competent jurisdiction; • any claim that challenges the reorganization or the consummation thereof; provided that such claim is transferred for coordinated or consolidated pre-trial proceedings at any time to MDL 1720 by the Judicial Panel on Multidistrict Litigation or otherwise included at any time in MDL 1720 by order of any court of competent jurisdiction; and • any case brought after October 22, 2015, by a merchant that opted out of the Rule 23(b)(3) settlement class pursuant to the 2012 Settlement Agreement in MDL 1720 that arises out of facts or circumstances substantially similar to those alleged in MDL 1720 and that is not transferred to or otherwise included in MDL 1720. See Note 20—Legal Matters . U.S. Litigation escrow agreement. In accordance with the U.S. litigation escrow agreement, the Company maintains an escrow account, from which settlements of, or judgments in, the U.S. covered litigation are paid. The amount of the escrow is determined by the board of directors and the Company's litigation committee, all members of which are affiliated with, or act for, certain Visa U.S.A. members. The escrow funds are held in money market investments along with the interest earned, less applicable taxes, and are classified as restricted cash on the consolidated balance sheets. The following table sets forth the changes in the U.S. litigation escrow account: Fiscal 2016 Fiscal 2015 (in millions) Balance at October 1 $ 1,072 $ 1,498 Payments to opt-out merchants (1) (45 ) (426 ) Balance at September 30 $ 1,027 $ 1,072 (1) These payments are associated with the interchange multidistrict litigation. See Note 20—Legal Matters . An accrual for the U.S. covered litigation and a change to the litigation provision are recorded when loss is deemed to be probable and reasonably estimable. In making this determination, the Company evaluates available information, including but not limited to recommendations made by the litigation committee. The accrual related to the U.S. covered litigation could be either higher or lower than the U.S. litigation escrow account balance. The Company did not record an additional accrual for the U.S. covered litigation during fiscal 2016. See Note 20—Legal Matters . Conversion feature. Under the terms of the plan, when the Company funds the U.S. litigation escrow account, the shares of class B common stock are subject to dilution through an adjustment to the conversion rate of the shares of class B common stock to shares of class A common stock. This has the same economic effect on diluted class A common stock earnings per share as repurchasing the Company's class A common stock, because it reduces the class B conversion rate and consequently the as-converted class A common stock share count. See Note 14—Stockholders' Equity . Indemnification obligations . To the extent that amounts available under the U.S. litigation escrow arrangement and other agreements in the plan are insufficient to fully resolve the U.S. covered litigation, the Company will use commercially reasonable efforts to enforce the indemnification obligations of Visa U.S.A.'s members for such excess amount, including but not limited to enforcing indemnification obligations pursuant to Visa U.S.A.'s certificate of incorporation and bylaws and in accordance with their membership agreements. Interchange judgment sharing agreement. Visa U.S.A. and Visa International have entered into an interchange judgment sharing agreement with certain Visa U.S.A. members that have been named as defendants in the interchange multidistrict litigation, which is described in Note 20—Legal Matters . Under this judgment sharing agreement, Visa U.S.A. members that are signatories will pay their membership proportion of the amount of a final judgment not allocated to the conduct of MasterCard. Loss sharing agreement. Visa has entered into a loss sharing agreement with Visa U.S.A., Visa International and certain Visa U.S.A. members. The loss sharing agreement provides for the indemnification of Visa U.S.A., Visa International and, in certain circumstances, Visa with respect to: (i) the amount of a final judgment paid by Visa U.S.A. or Visa International in the U.S. covered litigation after the operation of the interchange judgment sharing agreement, plus any amounts reimbursable to the interchange judgment sharing agreement signatories; or (ii) the damages portion of a settlement of a U.S. covered litigation that is approved as required under Visa U.S.A.'s certificate of incorporation by the vote of Visa U.S.A.'s specified voting members. The several obligation of each bank that is a party to the loss sharing agreement will equal the amount of any final judgment enforceable against Visa U.S.A., Visa International or any other signatory to the interchange judgment sharing agreement, or the amount of any approved settlement of a U.S. covered litigation, multiplied by such bank's then-current membership proportion as calculated in accordance with Visa U.S.A.'s certificate of incorporation. On October 22, 2015, Visa entered into an amendment to the loss sharing agreement. The amendment includes within the scope of U.S. covered litigation any action brought after the amendment by an opt out from the Rule 23(b)(3) Settlement Class in MDL 1720 that arises out of facts or circumstances substantially similar to those alleged in MDL 1720 and that is not transferred to or otherwise included in MDL 1720. On the same date, Visa entered into amendments to the interchange judgment sharing agreement and omnibus agreement that include any such action within the scope of those agreements as well. Omnibus agreement. Visa entered into an omnibus agreement with MasterCard and certain Visa U.S.A. members that confirmed and memorialized the signatories’ intentions with respect to the loss sharing agreement, the interchange judgment sharing agreement and other agreements relating to the interchange multidistrict litigation, see Note 20—Legal Matters . Under the omnibus agreement, the monetary portion of any settlement of the interchange multidistrict litigation covered by the omnibus agreement would be divided into a MasterCard portion at 33.3333% and a Visa portion at 66.6667% . In addition, the monetary portion of any judgment assigned to Visa-related claims in accordance with the omnibus agreement would be treated as a Visa portion. Visa would have no liability for the monetary portion of any judgment assigned to MasterCard-related claims in accordance with the omnibus agreement, and if a judgment is not assigned to Visa-related claims or MasterCard-related claims in accordance with the omnibus agreement, then any monetary liability would be divided into a MasterCard portion at 33.3333% and a Visa portion at 66.6667% . The Visa portion of a settlement or judgment covered by the omnibus agreement would be allocated in accordance with specified provisions of the Company's U.S. retrospective responsibility plan. The litigation provision on the consolidated statements of operations is not impacted by the execution of the omnibus agreement. On August 26, 2014, Visa entered into an amendment to the omnibus agreement. The omnibus amendment makes applicable to certain settlements in opt-out cases in the interchange multidistrict litigation the settlement-sharing provisions of the omnibus agreement, pursuant to which the monetary portion of any settlement of the interchange multidistrict litigation covered by the omnibus agreement would be divided into a MasterCard portion at 33.3333% and a Visa portion at 66.6667% . The omnibus amendment also provides that in the event of termination of the class Settlement Agreement, Visa and MasterCard would make mutually acceptable arrangements so that Visa shall have received two-thirds and MasterCard shall have received one-third of the total of (i) the sums paid to defendants as a result of the termination of the Settlement Agreement and (ii) the takedown payments previously made to defendants. Europe Retrospective Responsibility Plan The Company obtained certain protections for VE territory covered losses through the U.K.&I and Europe preferred stock, the U.K. loss sharing agreement, and the litigation management deed, referred to as the "Europe retrospective responsibility plan." See Note 2—Acquisition of Visa Europe and Note 20—Legal Matters . The plan covers VE territory covered litigation (and resultant liabilities and losses) relating to the covered period, which generally refers to the period before the Closing. Visa's protection from the plan is further limited to seventy percent of any liabilities where the claim relates to inter-regional multilateral interchange fee rates where the issuer is located outside the Visa Europe territory, while the merchant is located within the Visa Europe territory. The plan does not protect the Company against all types of litigation in Europe, only the interchange litigation specifically covered by the plan's terms. Unlike the U.S. retrospective responsibility plan, the Europe retrospective responsibility plan does not have an escrow account that is used to fund settlements or judgments. The Company is entitled to recover VE territory covered losses through a periodic adjustment to the class A common stock conversion rates applicable to the U.K.&I and Europe preferred stock. The total amount of protection available through the preferred stock component of the Europe retrospective responsibility plan is equivalent to the as-converted value of the preferred stock, which can be calculated at any point in time as the product of: (a) the outstanding number of shares of preferred stock; (b) the current conversion rate applicable to each class of preferred stock; and (c) Visa's class A common stock price. This amount differs from the value of the preferred stock recorded within stockholders' equity on the Company's consolidated balance sheet. The book value of the preferred stock reflects its historical value recorded at the Closing less VE territory covered losses recovered through a reduction of the applicable conversion rate. The book value does not reflect changes in the underlying class A common stock price subsequent to the Closing. Visa Inc. net income will not be impacted by VE territory covered losses as long as the as-converted value of the preferred stock is greater than the covered loss. VE territory covered losses will be recorded when the loss is deemed to be probable and reasonably estimable, or in the case of attorney's fees, when incurred. Concurrently, the Company will record a reduction to stockholders' equity and operating expenses, which represents the Company's right to recover such losses through adjustments to the conversion rate applicable to the preferred stock. The reduction to stockholders' equity is recorded in a contra-equity account referred to as "right to recover for covered losses." VE territory covered losses may be recorded before the corresponding adjustment to the applicable conversion rate is effected. Adjustments to the conversion rate may be executed once in any six-month period unless a single, individual loss greater than € 20 million is incurred, in which case, the six-month limitation does not apply. When the adjustment to the conversion rate is made, the amount previously recorded in "right to recover for covered losses" as contra-equity will then be recorded against the book value of the preferred stock within stockholders' equity. As of September 30, 2016, the Company had recorded $34 million in the "right to recover for covered losses" related to VE territory covered losses, of which $25 million was incurred prior to the Closing. There were no adjustments to the conversion rate in fiscal 2016. The following table sets forth the as-converted value of the preferred stock available to recover VE territory covered losses compared to the book value of preferred shares recorded in stockholders' equity within the Company's consolidated balance sheet as of September 30, 2016 (1) : September 30, 2016 As-Converted Value of Preferred Stock (2) Book Value of Preferred Stock (in millions) U.K.&I preferred stock $ 2,862 $ 2,516 Europe preferred stock 3,642 3,201 Total $ 6,504 $ 5,717 Less: Right to recover for covered losses (34 ) (34 ) Total recovery for covered losses available $ 6,470 $ 5,683 (1) Figures in the table may not recalculate exactly due to rounding. As-converted and book values are based on unrounded numbers. (2) The as-converted value of preferred stock is calculated as the product of: (a) 2 million and 3 million shares of the U.K.&I and Europe preferred stock outstanding, respectively, as of September 30, 2016; (b) the 13.952 class A common stock conversion rate applicable to both the U.K.&I and Europe preferred stock as of September 30, 2016; and (c) $82.70 , Visa's class A common stock closing stock price as of September 30, 2016. Figures in the table may not recalculate exactly due to rounding. Earnings per share is calculated based on unrounded numbers. |
Fair Value Measurements and Inv
Fair Value Measurements and Investments | 12 Months Ended |
Sep. 30, 2016 | |
Fair Value Measurements and Investments [Abstract] | |
Fair Value Measurements and Investments | Note 4—Fair Value Measurements and Investments Fair Value Measurements The Company measures certain assets and liabilities at fair value. See Note 1—Summary of Significant Accounting Policies . Assets and Liabilities Measured at Fair Value on a Recurring Basis Fair Value Measurements at September 30 Using Inputs Considered as Level 1 Level 2 Level 3 2016 2015 2016 2015 2016 2015 (in millions) Assets Cash equivalents and restricted cash: Money market funds $ 4,537 $ 3,051 U.S. government-sponsored debt securities $ 196 $ 280 Investment securities, trading: Equity securities 71 66 Investment securities, available-for-sale: U.S. government-sponsored debt securities 4,699 2,615 U.S. Treasury securities 2,178 2,656 Equity securities 53 4 Corporate debt securities 249 533 Auction rate securities $ — $ 7 Prepaid and other current assets: Foreign exchange derivative instruments 50 76 Other Assets: Foreign exchange derivative instruments 6 Total $ 6,839 $ 5,777 $ 5,200 $ 3,504 $ — $ 7 Liabilities Accrued liabilities: Visa Europe put option $ — $ 255 Foreign exchange derivative instruments $ 116 $ 13 Other liabilities: Foreign exchange derivative instruments $ 20 Total $ — $ — $ 136 $ 13 $ — $ 255 There were no transfers between Level 1 and Level 2 assets during fiscal 2016 . Level 1 assets measured at fair value on a recurring basis. Money market funds, publicly-traded equity securities and U.S. Treasury securities are classified as Level 1 within the fair value hierarchy, as fair value is based on quoted prices in active markets. Level 2 assets and liabilities measured at fair value on a recurring basis. The fair value of U.S. government-sponsored debt securities and corporate debt securities, as provided by third-party pricing vendors, is based on quoted prices in active markets for similar, not identical, assets. The pricing data obtained from outside sources is reviewed internally for reasonableness, compared against benchmark quotes from independent pricing sources, then confirmed or revised accordingly. Foreign exchange derivative instruments are valued using inputs that are observable in the market or can be derived principally from or corroborated by observable market data. There were no substantive changes to the valuation techniques and related inputs used to measure fair value during fiscal 2016 . Level 3 assets and liabilities measured at fair value on a recurring basis. Auction rate securities are classified as Level 3 due to a lack of trading in active markets and a lack of observable inputs in measuring fair value. There were no substantive changes to the valuation techniques and related inputs used to measure fair value during fiscal 2016 . Visa Europe put option agreement. On June 21, 2016, the Company acquired 100% of the share capital of Visa Europe, effected by the Visa Europe board of directors' exercise of the amended Visa Europe put option. Therefore, the Visa Europe put option was contractually terminated as a result of the transaction. During the first quarter of fiscal 2016, the Company recorded a $255 million non-cash decrease in the fair value of the put option as non-operating income in the Company's consolidated statements of operations, reducing the fair value of the liability to zero . See Note 2—Acquisition of Visa Europe . The liability was classified within Level 3 as the assumed probability that Visa Europe would elect to exercise its option in its unamended form, and the estimated P/E differential were among several unobservable inputs used to value the unamended put option. Assets Measured at Fair Value on a Non-recurring Basis Non-marketable equity investments and investments accounted for under the equity method . These investments are classified as Level 3 due to the absence of quoted market prices, the inherent lack of liquidity, and the fact that inputs used to measure fair value are unobservable and require management's judgment. When certain events or circumstances indicate that impairment may exist, the Company revalues the investments using various assumptions, including the financial metrics and ratios of comparable public companies. There were no significant impairment charges incurred during fiscal 2016 , 2015 and 2014 . At September 30, 2016 and 2015 , these investments totaled $46 million and $45 million , respectively. These assets are classified in other assets on the consolidated balance sheets. Non-financial assets and liabilities. Long-lived assets such as goodwill, indefinite-lived intangible assets, finite-lived intangible assets, and property, equipment and technology are considered non-financial assets. The Company does not have any non-financial liabilities measured at fair value on a non-recurring basis. Finite-lived intangible assets primarily consist of customer relationships, trade names, and reseller relationships, all of which were obtained through acquisitions. See Note 7—Intangible Assets and Goodwill . If the Company were required to perform a quantitative assessment for impairment testing of goodwill and indefinite-lived intangible assets, the fair values would generally be estimated using an income approach. As the assumptions employed to measure these assets on a non-recurring basis are based on management's judgment using internal and external data, these fair value determinations are classified as Level 3 in the fair value hierarchy. The Company completed its annual impairment review of its indefinite-lived intangible assets and goodwill as of February 1, 2016 , and concluded that there was no impairment. No recent events or changes in circumstances indicate that impairment existed at September 30, 2016 . See Note 1—Summary of Significant Accounting Policies . Other Fair Value Disclosures Long-term debt. In December 2015, the Company issued fixed-rate senior notes in an aggregate principal amount of $16.0 billion , with maturities ranging between 2 and 30 years. See Note 9—Debt . These debt instruments are measured at amortized cost on the Company's consolidated balance sheet at September 30, 2016 . The fair value of these notes, as provided by third-party pricing vendors, is based on quoted prices in active markets for similar, not identical, assets. The pricing data obtained from outside sources is reviewed internally for reasonableness, compared against benchmark quotes from independent pricing sources, then confirmed or revised accordingly. If measured at fair value in the financial statements, these instruments would be classified as Level 2 in the fair value hierarchy. The following table presents the carrying amount and estimated fair value of the Company’s debt in order of maturity: September 30, 2016 Carrying Amount Estimated Fair Value (in millions) 1.20% Senior Notes due December 2017 $ 1,746 $ 1,754 2.20% Senior Notes due December 2020 2,988 3,077 2.80% Senior Notes due December 2022 2,238 2,359 3.15% Senior Notes due December 2025 3,964 4,225 4.15% Senior Notes due December 2035 1,485 1,698 4.30% Senior Notes due December 2045 3,461 4,045 $ 15,882 $ 17,158 Other Financial Instruments not Measured at Fair Value The following financial instruments are not measured at fair value on the Company's consolidated balance sheet at September 30, 2016 , but require disclosure of their fair values: time deposits recorded in prepaid expenses and other current assets, settlement receivable and payable, and customer collateral. The estimated fair value of such instruments at September 30, 2016 approximates their carrying value due to their generally short maturities. If measured at fair value in the financial statements, these financial instruments would be classified as Level 2 in the fair value hierarchy. Investments Trading Investment Securities Trading investment securities include mutual fund equity security investments related to various employee compensation and benefit plans. Trading activity in these investments is at the direction of the Company's employees. These investments are held in trust and are not available for the Company's operational or liquidity needs. Interest and dividend income and changes in fair value are recorded in non-operating income, and offset in personnel expense on the consolidated statements of operations. As of September 30, 2016 and 2015 , trading investment securities totaled $71 million and $66 million , respectively. Available-for-sale Investment Securities The amortized cost, unrealized gains and losses and fair value of available-for-sale investment securities are as follows: September 30, 2016 September 30, 2015 Amortized Cost Gross Unrealized Fair Value Amortized Cost Gross Unrealized Fair Value Gains Losses Gains Losses (in millions) U.S. government-sponsored debt securities $ 4,693 $ 6 $ — $ 4,699 $ 2,612 $ 3 $ — $ 2,615 U.S. Treasury securities 2,176 3 — 2,179 2,652 4 — 2,656 Equity securities 7 46 — 53 4 — — 4 Corporate debt securities 248 — — 248 533 — — 533 Auction rate securities — — — — 7 — — 7 Total $ 7,124 $ 55 $ — $ 7,179 $ 5,808 $ 7 $ — $ 5,815 Less: current portion of available-for-sale investment securities (3,248 ) (2,431 ) Long-term available-for-sale investment securities $ 3,931 $ 3,384 The available-for-sale investment securities primarily include U.S. Treasury securities, U.S. government-sponsored debt securities and corporate debt securities. Available-for-sale debt securities are presented below in accordance with their stated maturities. The majority of these investments, $ 3.9 billion , are classified as non-current, as they have stated maturities of more than one year from the balance sheet date. However, these investments are generally available to meet short-term liquidity needs. Amortized Cost Fair Value (in millions) September 30, 2016: Due within one year $ 3,193 $ 3,195 Due after 1 year through 5 years 3,925 3,931 Due after 5 years through 10 years — — Due after 10 years — — Total $ 7,118 $ 7,126 Investment Income Investment income is recorded as non-operating income in the Company's consolidated statements of operations and consisted of the following: For the Years Ended September 30, 2016 2015 2014 (in millions) Interest and dividend income on cash and investments $ 75 $ 31 $ 25 Gain on other investments 5 3 8 Investment securities, trading: Unrealized gains (losses), net 3 (6 ) (2 ) Realized gains, net — 2 6 Investment securities, available-for-sale: Realized gains, net 3 21 1 Other-than-temporary impairment on investments (4 ) (5 ) (3 ) Investment income $ 82 $ 46 $ 35 |
Prepaid Expenses and Other Asse
Prepaid Expenses and Other Assets | 12 Months Ended |
Sep. 30, 2016 | |
Prepaid Expenses and Other Assets [Abstract] | |
Prepaid Expenses and Other Assets | Note 5—Prepaid Expenses and Other Assets Prepaid expenses and other current assets consisted of the following: September 30, September 30, (in millions) Prepaid operating expenses and maintenance $ 151 $ 137 Income tax receivable ( See Note 19—Income Taxes) 232 77 Foreign exchange derivative instruments ( See Note 12—Derivative Financial Instruments) 50 76 Other 122 63 Total $ 555 $ 353 Other non-current assets consisted of the following: September 30, September 30, (in millions) Non-current income tax receivable ( See Note 19—Income Taxes) $ 731 $ 627 Pension assets ( See Note 10—Pension, Postretirement and Other Benefits) 22 36 Other investments ( See Note 4—Fair Value Measurements and Investments) 46 45 Long-term prepaid operating expenses and other 72 57 Non-current deferred tax assets ( See Note 19—Income Taxes) (1) 22 13 Total $ 893 $ 778 (1) The Company elected to early adopt ASU 2015-17 on a retrospective basis effective October 1, 2015 and all deferred tax assets and liabilities are classified as non-current. Previously, current deferred tax assets had been presented separately and current deferred tax liabilities had been included in accrued liabilities on the consolidated balance sheets. See Note 1—Summary of Significant Accounting Policies and Note 19—Income Taxes . |
Property, Equipment and Technol
Property, Equipment and Technology, Net | 12 Months Ended |
Sep. 30, 2016 | |
Property, Plant and Equipment [Abstract] | |
Property, Equipment and Technology, Net | Note 6—Property, Equipment and Technology, Net Property, equipment and technology, net, consisted of the following: September 30, September 30, (in millions) Land $ 74 $ 71 Buildings and building improvements 839 803 Furniture, equipment and leasehold improvements 1,382 1,267 Construction-in-progress 125 120 Technology 2,378 2,022 Total property, equipment and technology 4,798 4,283 Accumulated depreciation and amortization (2,648 ) (2,395 ) Property, equipment and technology, net $ 2,150 $ 1,888 Technology consists of both purchased and internally developed software. Internally developed software primarily represents software utilized by the VisaNet electronic payments network. At September 30, 2016 and 2015 , accumulated amortization for technology was $1.5 billion and $1.4 billion , respectively. At September 30, 2016 , estimated future amortization expense on technology was as follows: Fiscal: 2017 2018 2019 2020 2021 and thereafter Total (in millions) Estimated future amortization expense $ 274 $ 209 $ 161 $ 108 $ 84 $ 836 Depreciation and amortization expense related to property, equipment and technology was $452 million , $431 million and $369 million for fiscal 2016 , 2015 and 2014 , respectively. Included in those amounts was amortization expense on technology of $259 million , $251 million and $198 million for fiscal 2016 , 2015 and 2014 , respectively. |
Intangible Assets, Net
Intangible Assets, Net | 12 Months Ended |
Sep. 30, 2016 | |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |
Intangible Assets, Net | Note 7—Intangible Assets and Goodwill Indefinite-lived and finite-lived intangible assets consisted of the following: September 30, 2016 September 30, 2015 Gross Accumulated Amortization Net Gross Accumulated Amortization Net (in millions) Finite-lived intangible assets: Customer relationships $ 351 $ (220 ) $ 131 $ 351 $ (196 ) $ 155 Trade names 192 (80 ) 112 192 (67 ) 125 Reseller relationships 95 (70 ) 25 95 (59 ) 36 Other 18 (9 ) 9 53 (17 ) 36 Total finite-lived intangible assets $ 656 $ (379 ) $ 277 $ 691 $ (339 ) $ 352 Indefinite-lived intangible assets: Customer relationships and reacquired rights $ 22,873 $ — $ 22,873 $ 6,925 $ — $ 6,925 Visa trade name 4,084 — 4,084 2,564 — 2,564 Visa Europe franchise right — — — 1,520 — 1,520 Total Indefinite-lived intangible assets $ 26,957 $ — $ 26,957 $ 11,009 $ — $ 11,009 Total intangible assets, net $ 27,613 $ (379 ) $ 27,234 $ 11,700 $ (339 ) $ 11,361 Amortization expense related to finite-lived intangible assets was $50 million , $63 million and $66 million for fiscal 2016 , 2015 and 2014 , respectively. At September 30, 2016 , estimated future amortization expense on finite-lived intangible assets is as follows: Fiscal: 2017 2018 2019 2020 2021 and thereafter Total (in millions) Estimated future amortization expense $ 46 40 40 40 111 $ 277 There was no impairment related to the Company’s indefinite-lived or finite-lived intangible assets during fiscal 2016 , 2015 or 2014 . The increase in total net intangible assets during 2016 was primarily related to the Company's acquisition of Visa Europe. Total purchase consideration of $18.8 billion was allocated to the tangible and identifiable intangible assets acquired and liabilities assumed based on their respective fair value on the acquisition date. Related indefinite-lived intangible assets recorded totaled $16.1 billion consisting of customer relationships and reacquired rights. Upon consummation of the acquisition, the Visa Europe franchise right of $1.5 billion , previously acquired as part of the Company's October 2007 reorganization, was reclassified as a Visa trade name intangible asset as the franchise right permitted Visa Europe's use of the Visa trade name and technology prior to acquisition. Goodwill of $3.3 billion was recorded to reflect the excess purchase consideration over net assets acquired. Intangible assets and goodwill recorded as a result of the Visa Europe acquisition are denominated in euros and translated into U.S. dollars. As such, the change in goodwill balance from the acquisition date to September 30, 2016 primarily includes the impact of $ 39 million resulting from changes in the euro to U.S. dollar exchange rate during the period. See Note 2—Acquisition of Visa Europe . |
Accrued and Other Liabilities
Accrued and Other Liabilities | 12 Months Ended |
Sep. 30, 2016 | |
Accrued and Other Liabilities [Abstract] | |
Accrued and Other Liabilities | Note 8—Accrued and Other Liabilities Accrued liabilities consisted of the following: September 30, September 30, (in millions) Accrued operating expenses (1) $ 347 $ 257 Visa Europe put option (See Note 2—Acquisition of Visa Europe ) (2) — 255 Accrued interest expenses (3) 145 — Accrued income taxes (See Note 19—Income Taxes ) 153 75 Other (5) 483 262 Total $ 1,128 $ 849 Other non-current liabilities consisted of the following: September 30, September 30, (in millions) Accrued income taxes (See Note 19—Income Taxes ) (4) $ 911 $ 752 Employee benefits 137 77 Other 114 68 Total $ 1,162 $ 897 (1) Increase includes accrued operating expenses assumed from the Visa Europe acquisition. (2) On June 21, 2016, the Company acquired 100% of the share capital of Visa Europe, effected by the Visa Europe board of directors' exercise of the amended Visa Europe put option. Therefore, the Visa Europe put option was contractually terminated as a result of the transaction. See Note 2—Acquisition of Visa Europe . (3) Interest expenses accrued as at September 30, 2016 is related to the issuance of long-term debt in December 2015. See Note 9—Debt . (4) The increase in non-current accrued income taxes is primarily related to the increase in liabilities for uncertain tax positions. (5) Current year balance includes amounts assumed from the Visa Europe acquisition related to uncertainties around foreign non-income tax obligations. Prior year current deferred tax liabilities have been retroactively reclassed to non-current deferred tax liabilities on the consolidated balance sheets upon adoption of FASB issued ASU 2015-17. See Note 1—Summary of Significant Accounting Policies and Note 19—Income Taxes . |
Debt
Debt | 12 Months Ended |
Sep. 30, 2016 | |
Debt Disclosure [Abstract] | |
Debt | Note 9—Debt The Company had outstanding debt as follows: September 30, 2016 Principal Amount Unamortized Discounts and Debt Issuance Costs Carrying Amount Effective Interest Rate (in millions, except percentages) 1.20% Senior Notes due December 2017 (the "2017 Notes") $ 1,750 $ (4 ) $ 1,746 1.37 % 2.20% Senior Notes due December 2020 (the "2020 Notes") 3,000 (12 ) 2,988 2.30 % 2.80% Senior Notes due December 2022 (the "2022 Notes") 2,250 (12 ) 2,238 2.89 % 3.15% Senior Notes due December 2025 (the "2025 Notes") 4,000 (36 ) 3,964 3.26 % 4.15% Senior Notes due December 2035 (the "2035 Notes") 1,500 (15 ) 1,485 4.23 % 4.30% Senior Notes due December 2045 (the "2045 Notes") 3,500 (39 ) 3,461 4.37 % Total long-term debt $ 16,000 $ (118 ) $ 15,882 Senior Notes In December 2015, the Company issued fixed-rate senior notes (the 2017 Notes, 2020 Notes, 2022 Notes, 2025 Notes, 2035 Notes and 2045 Notes, or collectively, the "Notes") in conjunction with the acquisition of Visa Europe, in an aggregate principal amount of $16.0 billion , with maturities ranging between 2 and 30 years. Interest on the Notes, at a rate ranging between 1.20% and 4.30% , is payable semi-annually on June 14 and December 14 of each year, commencing June 14, 2016. The Company recognized related interest expense of $399 million in fiscal 2016 as non-operating expense. The net aggregate proceeds from the issuance of the Notes, after deducting discounts and debt issuance costs, were $15.9 billion . The discounts and debt issuance costs are amortized over the respective term of each note using the effective interest method. The indenture governing the Notes contains customary event of default provisions. The Notes are senior unsecured obligations of the Company, ranking equally and ratably among themselves and with the Company's existing and future unsecured and unsubordinated debt. The Notes are not secured by any assets of the Company and are not guaranteed by any of the Company's subsidiaries. The Company was in compliance with all related covenants as of September 30, 2016 . Each series of the Notes may be redeemed as a whole or in part, at the Company’s option at any time, prior to, with respect to the 2017 Notes, their maturity date, and with respect to the 2020 Notes, the 2022 Notes, the 2025 Notes, the 2035 Notes and the 2045 Notes, the applicable par call date (as set forth in the table below), at a price equal to the greater of: • 100% of the principal amount of such Notes; and • the sum of the present value of the remaining scheduled payments of principal and interest through the maturity or par call date for each of the Notes below at the treasury rate defined under the terms of the Notes, plus the applicable spread for such Notes (as set forth in the table below), plus, in each case, accrued and unpaid interest to, but excluding, the date of redemption. Series Maturity/Par Call Date Spread 2017 Notes December 14, 2017 5 bps 2020 Notes November 14, 2020 10 bps 2022 Notes October 14, 2022 12.5 bps 2025 Notes September 14, 2025 15 bps 2035 Notes June 14, 2035 20 bps 2045 Notes June 14, 2045 20 bps On or after the applicable par call date, the Notes, except the 2017 Notes, may be redeemed as a whole or in part, at the Company’s option at any time, at a redemption price equal to 100% of the principal amount of the Notes being redeemed plus accrued interest. Future principal payments on the Company's outstanding debt are as follows: Fiscal Year 2017 2018 2019 2020 2021 Thereafter Total (in millions) $ — 1,750 — — 3,000 11,250 $ 16,000 Commercial Paper Program Visa maintains a commercial paper program to support its working capital requirements and for other general corporate purposes. Under the program, the Company is authorized to issue up to $3.0 billion in outstanding notes, with maturities up to 397 days from the date of issuance. The Company had no outstanding obligations under the program at September 30, 2016 . Credit Facility On January 27, 2016 , the Company, Visa International Service Association and Visa U.S.A. Inc., and subsequently, Visa Europe Limited and Visa Europe Services Inc. (collectively, the "Borrowers") entered into a 5-year, unsecured $4.0 billion revolving credit facility (the "Credit Facility") with Bank of America, N.A., as administrative agent and the lenders party thereto. JP Morgan Chase Bank, N.A., acted as syndication agent in connection with the Credit Facility; Bank of China, Los Angeles Branch, Barclays Bank PLC, Citibank, N.A., HSBC Bank USA, N.A., Royal Bank of Canada, Standard Chartered Bank, The Bank of Tokyo-Mitsubishi UFJ, Ltd., U.S. Bank National Association, Wells Fargo Bank National Association, Deutsche Bank Securities Inc. and Toronto Dominion (New York) LLC, acted as Documentation Agents; and J.P. Morgan Securities LLC, Merrill Lynch, Pierce, Fenner & Smith Incorporated, Bank of China, Los Angeles Branch, Barclays Bank PLC, Citigroup Global Markets, Inc., HSBC Bank USA, N.A., RBC Capital Markets, Standard Chartered Bank, The Bank of Tokyo-Mitsubishi UFJ, Ltd., U.S. Bank National Association, Wells Fargo Securities, LLC, Deutsche Bank Securities Inc. and TD Securities (USA) LLC, acted as joint lead arrangers and joint book runners. The Credit Facility, which expires on January 27, 2021 , replaced the Company's prior $3.0 billion credit facility, which expired on January 27, 2016 . The Credit Facility provides the Borrowers with a borrowing capacity of up to $4.0 billion . Borrowings under the Credit Facility are available for general corporate purposes. Interest on the borrowings under the Credit Facility would be charged at the London Interbank Offered Rate (LIBOR) or an alternative base rate, in each case plus applicable margins that fluctuate based on the applicable rating of senior unsecured long-term securities of the Company. The Borrowers have agreed to pay a commitment fee which will fluctuate based on such applicable rating of the Company. Other material terms are: • a financial covenant which requires the Company to maintain a Consolidated Indebtedness to Consolidated EBITDA Ratio (as defined in the Credit Facility) of not greater than 3.75 to 1.00; • customary restrictive covenants, which limit the Borrowers' ability to, among other things, create certain liens, effect fundamental changes to their business, or merge or dispose substantially all of their assets, subject in each case to customary exceptions and amounts; • customary events of default, upon the occurrence of which, after any applicable grace period, the requisite lenders will have the ability to accelerate all outstanding loans thereunder and terminate the commitments; and • other customary and standard terms and conditions. The Borrowers had no borrowings under the Credit Facility and the Company was in compliance with all related covenants as of and during the year ended September 30, 2016 . The participating lenders in the Credit Facility include certain holders of the Company's class B and class C common stock and U.K.&I and Europe preferred stock, certain of the Borrowers' customers and their affiliates. |
Pension, Postretirement and Oth
Pension, Postretirement and Other Benefits | 12 Months Ended |
Sep. 30, 2016 | |
Defined Contribution Pension and Other Postretirement Plans Disclosure [Abstract] | |
Pension, Postretirement and Other Benefits | Note 10—Pension, Postretirement and Other Benefits The Company sponsors various qualified and non-qualified defined benefit pension and other postretirement benefit plans that provide for retirement and medical benefits for substantially all employees residing in the United States. The Company also sponsors other pension benefit plans that provide benefits for internationally-based employees at certain non-U.S. locations. As a result of the acquisition of Visa Europe, the Company assumed the obligations related to Visa Europe's defined benefit plan, primarily consisting of the U.K. funded and unfunded pension plans. Disclosures presented below include the U.S. pension plans and the non-U.S. plans, comprising only the Visa Europe plans. Disclosures relating to other non-U.S. pension benefit plans are not included as they are immaterial, individually and in aggregate. The Company uses a September 30 measurement date for its pension and other postretirement benefit plans. Defined benefit pension plans. The U.S. pension benefits under the defined benefit pension plan are earned based on a cash balance formula. An employee’s cash balance account is credited with an amount equal to 6% of eligible compensation plus interest based on 30-year Treasury securities. In October 2015, the Company's board of directors approved an amendment of the U.S. qualified defined benefit pension plan such that the Company discontinued employer provided credits after December 31, 2015. Plan participants continue to earn interest credits on existing balances at the time of the freeze. As a result, a curtailment gain totaling $8 million was recognized in fiscal 2016 as part of the Company's net periodic benefit cost. The funding policy for the U.S. pension benefits is to contribute annually no less than the minimum required contribution under ERISA. Under the Visa Europe U.K. pension plans, presented below under "non-U.S. plans", retirement benefits are provided based on the participants' final pensionable pay and are currently closed to new entrants. However, future benefits continue to accrue for active participants. The funding policy is to contribute in accordance with the appropriate funding requirements agreed with the trustees of the U.K. pension plans. Additional amounts may be agreed with the U.K. pension plan trustees. Postretirement benefits plan. The postretirement benefits plan provides medical benefits for retirees and dependents who meet minimum age and service requirements. Benefits are provided from retirement date until age 65 . Retirees must contribute on a monthly basis for the same coverage that is generally available to active employees and their dependents. The Company’s contributions are funded on a current basis. Summary of Plan Activities Change in Benefit Obligation: U.S. Plans Non-U.S. Plans Pension Benefits Other Postretirement Benefits Pension Benefits September 30, September 30, September 30, 2016 2015 2016 2015 2016 (in millions) Benefit obligation—beginning of fiscal year $ 1,005 $ 983 $ 18 $ 20 $ — Visa Europe acquisition — — — — 381 Service cost 13 47 — — 1 Interest cost 40 40 1 1 3 Actuarial loss (gain) 86 40 (2 ) — 86 Benefit payments (64 ) (105 ) (3 ) (3 ) (1 ) Plan amendment (8 ) — — — — Foreign currency exchange rate changes — — — — 4 Benefit obligation—end of fiscal year $ 1,072 $ 1,005 $ 14 $ 18 $ 474 Accumulated benefit obligation $ 1,072 $ 994 NA NA $ 474 Change in Plan Assets: Fair value of plan assets—beginning of fiscal year $ 1,022 $ 1,117 $ — $ — $ — Visa Europe acquisition — — — — 287 Actual return on plan assets 118 (6 ) — — 25 Company contribution 1 16 3 3 102 Benefit payments (64 ) (105 ) (3 ) (3 ) (1 ) Foreign currency exchange rate changes — — — — 2 Fair value of plan assets—end of fiscal year $ 1,077 $ 1,022 $ — $ — $ 415 Funded status at end of fiscal year $ 5 $ 17 $ (14 ) $ (18 ) $ (59 ) Recognized in Consolidated Balance Sheets: Non-current asset $ 22 $ 36 $ — $ — $ — Current liability (9 ) (9 ) (3 ) (3 ) (6 ) Non-current liability (8 ) (10 ) (11 ) (15 ) (53 ) Funded status at end of fiscal year $ 5 $ 17 $ (14 ) $ (18 ) $ (59 ) Amounts recognized in accumulated other comprehensive income before tax: U.S. Plans Non-U.S. Plans Pension Benefits Other Postretirement Benefits Pension Benefits September 30, September 30, September 30 2016 2015 2016 2015 2016 (in millions) Net actuarial loss (gain) $ 241 $ 232 $ (5 ) $ (5 ) $ 66 Prior service credit — (9 ) (2 ) (5 ) — Total $ 241 $ 223 $ (7 ) $ (10 ) $ 66 Amounts from accumulated other comprehensive income to be amortized into net periodic benefit cost in fiscal 2017 : U.S. Plans Non-U.S. Plans Pension Benefits Other Postretirement Benefits Pension Benefits (in millions) Actuarial loss (gain) $ 15 $ (1 ) $ 2 Prior service credit — (2 ) — Total $ 15 $ (3 ) $ 2 Benefit obligations in excess of plan assets related to the Company's U.S. non-qualified plan and the non-U.S. pension plans: U.S. Plans Non-U.S. Plans September 30, September 30, 2016 2015 2016 (in millions) Accumulated benefit obligation in excess of plan assets Accumulated benefit obligation—end of year $ (16 ) $ (19 ) $ (474 ) Fair value of plan assets—end of year $ — $ — $ 415 Projected benefit obligation in excess of plan assets Benefit obligation—end of year $ (16 ) $ (19 ) $ 474 Fair value of plan assets—end of year $ — $ — $ 415 Net periodic pension and other postretirement plan cost: U.S. Plans Non-U.S. Plans (1) Pension Benefits Other Postretirement Benefits Pension Benefits Fiscal 2016 2015 2014 2016 2015 2014 2016 (in millions) Service cost $ 13 $ 47 $ 46 $ — $ — $ — $ 1 Interest cost 40 40 42 1 1 1 3 Expected return on assets (69 ) (72 ) (68 ) — — — (4 ) Amortization of: Prior service credit (1 ) (7 ) (8 ) (3 ) (3 ) (3 ) — Actuarial loss (gain) 7 1 1 (2 ) (2 ) (1 ) — Net benefit cost $ (10 ) $ 9 $ 13 $ (4 ) $ (4 ) $ (3 ) $ — Curtailment gain (8 ) — (3 ) — — — — Settlement loss 13 7 3 — — — — Total net periodic benefit cost $ (5 ) $ 16 $ 13 $ (4 ) $ (4 ) $ (3 ) $ — (1) Represents Visa Europe's U.K. pension plans' net pension benefit cost recognized from the Closing through September 30, 2016. Other changes in plan assets and benefit obligations recognized in other comprehensive income: U.S. Plans Non-U.S. Plans Pension Benefits Other Postretirement Benefits Pension Benefits 2016 2015 2016 2015 2016 (in millions) Current year actuarial loss (gain) $ 30 $ 119 $ (2 ) $ — $ 66 Amortization of actuarial (loss) gain (20 ) (8 ) 2 2 — Current year prior service credit — — — — — Amortization of prior service credit 9 7 3 3 — Total recognized in other comprehensive income $ 19 $ 118 $ 3 $ 5 $ 66 Total recognized in net periodic benefit cost and other comprehensive income $ 14 $ 134 $ (1 ) $ 1 $ 66 Weighted Average Actuarial Assumptions: U.S. Plans Non-U.S. Plans Fiscal 2016 2015 2014 2016 Discount rate for benefit obligation: (1) Pension 3.62 % 4.33 % 4.27 % 2.40 % Postretirement 1.91 % 2.43 % 2.59 % NA Discount rate for net periodic benefit cost: Pension 4.33 % 4.27 % 4.81 % 3.10 % Postretirement 2.43 % 2.59 % 2.76 % NA Expected long-term rate of return on plan assets (2) 7.00 % 7.00 % 7.00 % 3.92 % Rate of increase in compensation levels for: (3) Benefit obligation NA 4.00 % 4.00 % 3.20 % Net periodic benefit cost NA 4.00 % 4.50 % 3.00 % (1) Represents a single weighted-average discount rate derived based on a cash flow matching analysis, with the projected benefit payments matching spot rates from a yield curve developed from high-quality corporate bonds. (2) Primarily based on the targeted allocation, and evaluated for reasonableness by considering such factors as: (i) actual return on plan assets; (ii) historical rates of return on various asset classes in the portfolio; (iii) projections of returns on various asset classes; and (iv) current and prospective capital market conditions and economic forecasts. (3) This assumption is not applicable for to the U.S. plans in fiscal 2016 due to the amendment of the U.S. qualified defined benefit pension plan in October 2015, which discontinued the employer provided credits effective after December 31, 2015. The assumed annual rate of future increases in health benefits for the other postretirement benefits plan is 8% for fiscal 2017 . The rate is assumed to decrease to 5% by 2021 and remain at that level thereafter. These trend rates reflect management’s expectations of future rates. Increasing or decreasing the healthcare cost trend by 1% would change the postretirement plan benefit obligation by less than $1 million . Pension Plan Assets Pension plan assets are managed with a long-term perspective to ensure that there is an adequate level of assets to support benefit payments to participants over the life of the pension plan. Pension plan assets are managed by external investment managers. Investment manager performance is measured against benchmarks for each asset class on a quarterly basis. An independent consultant assists management with investment manager selections and performance evaluations. Pension plan assets are broadly diversified to maintain a prudent level of risk and to provide adequate liquidity for benefit payments. The Company generally evaluates and rebalances the pension plan assets, as appropriate, to ensure that allocations are consistent with target allocation ranges. The weighted average targeted allocation for U.S. pension plan assets is as follows: equity securities of 50% to 80% , fixed income securities of 25% to 35% and other, primarily consisting of cash equivalents to meet near term expected benefit payments and expenses, of up to 7% . At September 30, 2016 , U.S. pension plan asset allocations for these categories were 62% , 34% and 4% , respectively, which were within target allocation ranges. The weighted average targeted allocation for non-U.S. pension plans is as follows: equity securities of 40% , fixed income securities of 20% and other of 40% , consisting of cash, multi-asset funds, and property. At September 30, 2016 , non-U.S. pension plan asset allocations for these categories were 28% , 22% and 50% , respectively. The actual allocated percentage to other category exceeding the target is attributed to the $102 million cash contribution made in September 2016. The following table sets forth by level, within the fair value hierarchy, the pension plan’s investments at fair value as of September 30, 2016 and 2015 , including the impact of transactions that were not settled at the end of September: U.S. Plans Fair Value Measurements at September 30, Level 1 Level 2 Level 3 Total 2016 2015 2016 2015 2016 2015 2016 2015 (in millions) Cash equivalents $ 39 $ 11 $ 39 $ 11 Corporate debt securities $ 185 $ 169 185 169 U.S. government-sponsored debt securities 30 66 30 66 U.S. Treasury securities 100 74 100 74 Asset-backed securities $ 51 $ 31 51 31 Equity securities 672 671 672 671 Total $ 811 $ 756 $ 215 $ 235 $ 51 $ 31 $ 1,077 $ 1,022 Non-U.S. Plans Fair Value Measurements at September 30, 2016 Level 1 Level 2 Level 3 Total (in millions) Cash equivalents $ 105 $ 105 Corporate debt securities $ 39 39 U.K. Treasury securities 52 52 Asset-backed securities $ 29 29 Equity securities 116 116 Multi-asset securities (1) 74 74 Total $ 273 $ 113 $ 29 $ 415 (1) Multi-asset securities represents pension plan assets that are invested in funds comprised of broad ranges of assets. Level 1 assets. Cash equivalents (money market funds, time deposits and treasury bills), U.S. and U.K. Treasury securities and equity securities are classified as Level 1 within the fair value hierarchy, as fair value is based on quoted prices in active markets. Level 2 assets. The fair values of U.S. government-sponsored, corporate debt and multi-asset securities are based on quoted prices in active markets for similar assets as provided by third-party pricing vendors. This pricing data is reviewed internally for reasonableness through comparisons with benchmark quotes from independent third-party sources. Based on this review, the valuation is confirmed or revised accordingly. Level 3 assets. Asset-backed securities are bonds that are backed by various types of assets and primarily consist of mortgage-backed securities. Asset-backed securities are classified as Level 3 due to a lack of observable inputs in measuring fair value. There were no transfers between Level 1 and Level 2 assets during fiscal 2016 or 2015 . A separate roll-forward of Level 3 plan assets measured at fair value is not presented because activities during fiscal 2016 and 2015 were immaterial. Cash Flows U.S. Plans Non-U.S. Plans Pension Benefits Other Postretirement Benefits Pension Benefits Actual employer contributions (in millions) 2016 $ 1 $ 3 $ 102 2015 $ 16 $ 3 $ — Expected employer contributions 2017 $ 9 $ 3 $ 6 Expected benefit payments 2017 $ 165 $ 3 $ 4 2018 $ 88 $ 3 $ 4 2019 $ 85 $ 2 $ 5 2020 $ 84 $ 2 $ 5 2021 $ 81 $ 2 $ 5 2022-2026 $ 350 $ 2 $ 27 Other Benefits The Company sponsors a defined contribution plan, or 401(k) plan, that covers substantially all of its employees residing in the United States. Personnel costs included $55 million , $49 million and $46 million in fiscal 2016 , 2015 and 2014 , respectively, for expenses attributable to the Company’s employees under the 401(k) plan. The Company’s contributions to this 401(k) plan are funded on a current basis, and the related expenses are recognized in the period that the payroll expenses are incurred. |
Settlement Guarantee Management
Settlement Guarantee Management | 12 Months Ended |
Sep. 30, 2016 | |
Settlement Guarantee Management [Abstract] | |
Settlement Guarantee Management | Note 11—Settlement Guarantee Management The Company indemnifies its clients for settlement losses suffered due to failure of any other client to fund its settlement obligations in accordance with the Visa Rules. This indemnification creates settlement risk for the Company due to the difference in timing between the date of a payment transaction and the date of subsequent settlement. Settlement at risk, or exposure, is estimated based on the sum of the following inputs: (1) average daily volumes during the quarter multiplied by the estimated number of days to settle plus a safety margin; (2) four months of rolling average chargebacks volume; and (3) the total balance for outstanding Visa Travelers Cheques. The Company maintains and regularly reviews global settlement risk policies and procedures to manage settlement exposure, which may require clients to post collateral if certain credit standards are not met. The Company's settlement exposure is limited to the amount of unsettled Visa payment transactions at any point in time. The Company's estimated maximum settlement exposure was $67.8 billion for the period ended September 30, 2016 , including Visa Europe, compared to $43.5 billion for the period ended September 30, 2015 , which excludes Visa Europe. The increase in the Company's estimated maximum settlement exposure for the period ended September 30, 2016 is due to the Visa Europe acquisition. Of these amounts, $2.9 billion and $2.2 billion at September 30, 2016 and 2015 , respectively, were covered by collateral. The total available collateral balances presented below were greater than the settlement exposure covered by customer collateral held due to instances in which the available collateral exceeded the total settlement exposure for certain financial institutions at each date presented. The Company maintained collateral as follows: September 30, September 30, (in millions) Cash equivalents $ 1,295 $ 1,023 Pledged securities at market value 170 154 Letters of credit 1,311 1,178 Guarantees 1,418 971 Total $ 4,194 $ 3,326 The balances above included collateral held by Visa Europe as follows: September 30, (in millions) Cash equivalents (1) $ 294 Pledged securities at market value — Letters of credit 144 Guarantees 375 Total $ 813 (1) Cash collateral held by Visa Europe is not included on the Company's consolidated balance sheet as its clients retain beneficial ownership and the cash is only accessible to the Company in the event of default by the client on its settlement obligations. Cash equivalents collateral, excluding cash collateral held by Visa Europe, is reflected in customer collateral on the consolidated balance sheets as it is held in escrow in the Company's name. All other collateral is excluded from the consolidated balance sheets. Pledged securities are held by third parties in trust for the Company and clients. Letters of credit are provided primarily by client financial institutions to serve as irrevocable guarantees of payment. Guarantees are provided primarily by parent financial institutions to secure the obligations of their subsidiaries. The Company routinely evaluates the financial viability of institutions providing the guarantees. The fair value of the settlement risk guarantee is estimated using a proprietary model which considers statistically derived loss factors based on historical experience, estimated settlement exposures at period end and a standardized grading process for clients (using, where available, third-party estimates of the probability of customer failure). Historically, the Company experienced minimal losses, which has contributed to an estimated probability-weighted value of the guarantee of approximately $2 million and $1 million at September 30, 2016 and 2015 , respectively. These amounts were reflected in accrued liabilities on the consolidated balance sheets. |
Derivative Financial Instrument
Derivative Financial Instruments | 12 Months Ended |
Sep. 30, 2016 | |
Derivative Instruments and Hedging Activities Disclosure [Abstract] | |
Derivative Financial Instruments | Note 12—Derivative and Non-derivative Financial Instruments Derivative Financial Instruments Designated derivative financial instrument hedges. The Company maintains a rolling cash flow hedge program with the objective of reducing foreign currency exchange rate risk from forecasted net exposures of revenues and expenses derived from and payments made in non-functional currencies during the following twelve months. The aggregate notional amount of the Company's derivative contracts outstanding in its hedge program was $1.6 billion at September 30, 2016 and $1.2 billion at September 30, 2015 . The increase in the aggregate notional amounts of the Company's derivative contracts includes the addition of $189 million notional of derivative contracts entered into for Visa Europe after the Closing. As of September 30, 2016 , the Company’s cash flow hedges in an asset position totaled $17 million and were classified in prepaid expenses and other current assets on the consolidated balance sheet, while cash flow hedges in a liability position totaled $78 million and were classified in accrued liabilities on the consolidated balance sheet. These amounts are subject to master netting agreements, which provide the Company with a legal right to net settle multiple payable and receivable positions with the same counterparty, in a single currency through a single payment. However, the Company presents fair values on a gross basis on the consolidated balance sheets . See Note 1—Summary of Significant Accounting Policies . To qualify for cash flow hedge accounting treatment, the Company formally documents, at inception of the hedge, all relationships between the hedging transactions and the hedged items, as well as the Company's risk management objective and strategy for undertaking various hedge transactions. The Company also formally assesses whether the derivatives that are used in hedging transactions are highly effective in offsetting changes in the cash flows of the hedged items and whether those derivatives may be expected to remain highly effective in future periods. The Company uses regression analysis to assess hedge effectiveness prospectively and retrospectively. The effectiveness tests are performed on the foreign exchange forward contracts based on changes in the spot rate of the derivative instrument compared to changes in the spot rate of the forecasted hedged transaction. Forward points are excluded for effectiveness testing and measurement purposes. The excluded forward points are reported in earnings. For fiscal 2016 , 2015 and 2014 , the amounts by which earnings were reduced relating to excluded forward points were $30 million , $29 million and $27 million , respectively. The effective portion of changes in the fair value of derivative contracts is recorded as a component of accumulated other comprehensive income or loss on the consolidated balance sheets. When the forecasted transaction occurs and is recognized in earnings, the amount in accumulated other comprehensive income or loss related to that hedge is reclassified to operating revenue or expense. The Company expects to reclassify $58 million of pre-tax losses to earnings during fiscal 2017. Non-designated derivative financial instrument hedges. The Company entered into currency forward contracts during the second and third quarters of fiscal 2016 to mitigate a portion of the foreign currency exchange rate risk associated with the upfront cash consideration paid in the Visa Europe acquisition with additional offsetting currency forward contracts entered into subsequently to eliminate its risk-mitigation positions. All contracts matured during the third and fourth quarters of fiscal 2016. As these contracts were not designated in hedging relationships, related gains and losses were recorded directly in earnings as part of non-operating income in the consolidated financial statements. The Company recorded net gains of $74 million related to these contracts in fiscal 2016. Subsequent to the acquisition of Visa Europe, the Company entered into currency forward contracts to offset Visa Europe hedges outstanding at the date of the acquisition that did not qualify for cash flow hedge accounting treatment in accordance with U.S. GAAP or the Company’s accounting policy. The fair values of both the original currency forward contracts and the offsetting hedges are classified in prepaid expenses and other current assets, non-current other assets, accrued liabilities and non-current other liabilities on the consolidated balance sheet. The Company utilizes foreign exchange derivative contracts to hedge against foreign currency exchange rate fluctuations related to certain monetary assets and liabilities denominated in foreign currency held by Visa Europe. As of September 30, 2016 , the aggregate notional amount of these balance sheet hedges was $1.1 billion . The Company did not have any balance sheet hedges outstanding at September 30, 2015 . Gains and losses on the derivative contracts partially offset gains and losses on the hedged monetary assets and liabilities denominated in foreign currency. These amounts are recorded in general and administrative in the Company's consolidated statement of operations as these instruments are not designated for hedge accounting. Credit and market risks. The Company's derivative financial instruments are subject to both credit and market risk. The Company monitors the credit-worthiness of the financial institutions that are counterparties to its derivative financial instruments and does not consider the risks of counterparty nonperformance to be significant. The Company mitigates this risk by entering into master netting agreements, and except for derivative instruments entered into by Visa Europe, such agreements require each party to post collateral against its net liability position with the respective counterparty. As of September 30, 2016 , the Company has received collateral of $8 million from counterparties, which is included in accrued liabilities in the consolidated balance sheet, and posted collateral of $54 million , which is included in other assets in the consolidated balance sheet. Notwithstanding the Company’s efforts to manage foreign exchange risk, there can be no absolute assurance that its hedging activities will adequately protect against the risks associated with foreign currency fluctuations. Credit and market risks related to derivative instruments were not considered significant at September 30, 2016 . Additional disclosures that demonstrate how derivative instruments and related hedged items affect an entity's financial position, financial performance and cash flows have not been presented because the impact of derivative instruments is immaterial to the overall consolidated financial statements. Non-derivative Financial Instrument Designated as a Net Investment Hedge The Company designated the euro-denominated deferred cash consideration liability of $1.2 billion (see Note 2—Acquisition of Visa Europe ), a non-derivative financial instrument, as a hedge against a portion of the foreign currency exchange rate exposure of the Company's euro-denominated net investment of $18.8 billion in Visa Europe. Changes in the value of the deferred cash consideration liability, attributable to the change in exchange rates at the end of each reporting period, partially offset the foreign currency translation of the Company's net investment recorded in accumulated other comprehensive income in the Company's consolidated balance sheet. Changes in the euro exchange rate against the U.S. dollar from the acquisition date of June 21, 2016 to the balance sheet date of September 30, 2016 resulted in net foreign currency translation adjustments of $218 million . |
Enterprise-wide Disclosures and
Enterprise-wide Disclosures and Concentration of Business | 12 Months Ended |
Sep. 30, 2016 | |
Enterprise-wide Disclosures and Concentration of Business [Abstract] | |
Enterprise-wide Disclosures and Concentration of Business | Note 13—Enterprise-wide Disclosures and Concentration of Business The Company’s long-lived net property, equipment and technology assets are classified by major geographic areas as follows: September 30, September 30, (in millions) United States $ 1,827 $ 1,806 International 323 82 Total $ 2,150 $ 1,888 Revenue by geographic market is primarily based on the location of the issuing financial institution. Revenues earned in the United States were approximately 52% of net operating revenues in fiscal 2016 , 53% in fiscal 2015 and 54% in fiscal 2014 . No individual country, other than the United States, generated more than 10% of net operating revenues in these years. A significant portion of Visa’s operating revenues is concentrated among its largest clients. Loss of business from any of these clients could have an adverse effect on the Company. The Company did not have any customer that generated greater than 10% of its net operating revenues in fiscal 2016 , 2015 or 2014 . |
Stockholders' Equity
Stockholders' Equity | 12 Months Ended |
Sep. 30, 2016 | |
Stockholders' Equity Note [Abstract] | |
Stockholders' Equity | Note 14—Stockholders' Equity Visa Europe acquisition. In connection with the Visa Europe acquisition, three new series of preferred stock of the Company were created. Upon issuance, all of the preferred stock participate on an as-converted basis in regular quarterly cash dividends declared on the Company's class A common stock. Additionally, Visa Europe holds shares of Visa Inc.'s class C common stock, which were treated as treasury stock in purchase accounting. See Note 2—Acquisition of Visa Europe . Class A common stock split. In January 2015, Visa’s board of directors declared a four -for-one split of its class A common stock. Each class A common stockholder as of the record date received a dividend of three additional shares for every share held as of the record date. Holders of class B and C common stock did not receive a stock dividend. Instead, the conversion rate for class B common stock increased to 1.6483 shares of class A common stock per share of class B common stock, and the conversion rate for class C common stock increased to 4.0 shares of class A common stock per share of class C common stock. Immediately following the split, the class A, B and C stockholders retained the same relative ownership percentages that they had prior to the stock split. All per share amounts and number of shares outstanding in these consolidated financial statements and accompanying notes are presented on a post-split basis. As a result of the stock split, all historical per share data and number of shares outstanding presented have been retroactively adjusted. As-converted class A common stock. The U.K.&I and Europe preferred stock, issued in the Visa Europe acquisition, is convertible upon certain conditions into shares of class A common stock or class A equivalent preferred stock, at an initial conversion rate of 13.952 shares of class A common stock for each share of U.K.&I preferred stock and Europe preferred stock. The conversion rates may be reduced from time to time to offset certain liabilities. See Note 2—Acquisition of Visa Europe and Note 3—U.S. and Europe Retrospective Responsibility Plans . The number of shares of each series and class and the number of shares of class A common stock on an as-converted basis at September 30, 2016 , are as follows: (in millions, except conversion rate) Shares Outstanding Conversion Rate Into Class A Common Stock As-converted Class A Common Stock (1) U.K.&I preferred stock 2 13.9520 35 Europe preferred stock 3 13.9520 44 Class A common stock (2) 1,871 — 1,871 Class B common stock 245 1.6483 (3) 405 Class C common stock 17 4.0000 67 Total 2,422 (1) Figures in the table may not recalculate exactly due to rounding. As-converted class A common stock is calculated based on unrounded numbers. (2) Class A common stock shares outstanding reflect repurchases settled on or before September 30, 2016. The Company repurchased an additional 1 million shares at the end of September, which did not settle until October 2016. (3) The class B to class A common stock conversion rate is presented on a rounded basis. Conversion calculations for dividend payments are based on a conversion rate rounded to the tenth decimal. Common stock repurchases. The following table presents share repurchases in the open market during the following fiscal years: (in millions, except per share data) 2016 (1) 2015 Shares repurchased in the open market (2) 91 44 Average repurchase price per share (3) $ 77.05 $ 65.98 Total cost $ 6,987 $ 2,910 (1) Shares repurchased in the open market reflect repurchases settled on or before September 30, 2016. The Company repurchased an additional 1 million shares for $120 million at the end of September, which did not settle until October 2016. (2) All shares repurchased in the open market have been retired and constitute authorized but unissued shares. (3) Figures in the table may not recalculate exactly due to rounding. Average repurchase price per share is calculated based on unrounded numbers. The Company's board of directors authorized share repurchase programs in October 2015 and July 2016 at $5.0 billion each. As of September 30, 2016 , the programs had remaining authorized funds of $5.8 billion . All share repurchase programs authorized prior to October 2015 have been completed. Visa Europe held approximately 550,000 shares of the Company's class C common stock valued at $170 million at the Closing, which was recorded as treasury stock at the time of the acquisition. Class B common stock. The class B common stock is not convertible or transferable until the date on which all of the U.S. covered litigation has been finally resolved. This transfer restriction is subject to limited exceptions, including transfers to other holders of class B common stock. After termination of the restrictions, the class B common stock will be convertible into class A common stock if transferred to a person that was not a Visa Member (as defined in the current certificate of incorporation) or similar person or an affiliate of a Visa Member or similar person. Upon such transfer, each share of class B common stock will automatically convert into a number of shares of class A common stock based upon the applicable conversion rate in effect at the time of such transfer. Adjustment of the conversion rate occurs upon: (i) the completion of any follow-on offering of class A common stock completed to increase the size of the U.S. litigation escrow account (or any cash deposit by the Company in lieu thereof) resulting in a further corresponding decrease in the conversion rate; or (ii) the final resolution of the U.S. covered litigation and the release of funds remaining on deposit in the U.S. litigation escrow account to the Company resulting in a corresponding increase in the conversion rate. There were no deposits into the U.S. litigation escrow account in fiscal 2016 or 2015. See Note 3—U.S. and Europe Retrospective Responsibility Plans . Class C common stock. As of September 30, 2016 , all of the shares of class C common stock have been released from transfer restrictions. A total of 134 million shares have been converted from class C to class A common stock upon their sale into the public market and approximately 550,000 shares held by Visa Europe were recorded as treasury stock at the time of the acquisition. Preferred stock. Preferred stock may be issued as redeemable or non-redeemable, and has preference over any class of common stock with respect to the payment of dividends and distribution of the Company’s assets in the event of a liquidation or dissolution. The Company had 5 million shares of U.K.&I and Europe preferred stock outstanding at the end of fiscal 2016 and no shares of preferred stock outstanding at the end of fiscal 2015. The shares of U.K.&I and Europe preferred stock are subject to restrictions on transfer and may become convertible in stages based on developments in the VE territory covered litigation. See Note 2—Acquisition of Visa Europe . Voting rights. The holders of the U.K.&I and Europe preferred stock have no right to vote on any matters, except for certain defined matters, including, in specified circumstances, any consolidation, merger, combination or similar transaction of the Company in which the preferred stockholders would either (i) receive shares of common stock or other equity securities of the Company with preferences, rights and privileges that are not substantially identical to the preferences, rights and privileges of the applicable series of preferred stock or (ii) receive securities, cash or other property that is different from what our class A common stockholders would receive. With respect to these limited matters on which the holders of preferred stock may vote, approval by the preferred stockholders requires the affirmative vote of the outstanding voting power of each such series of preferred stock, each such series voting as a single class. In either case, the U.K.&I and Europe preferred stockholders are entitled to cast a number of votes equal to the number of shares held by each such holder. Class A common stockholders have the right to vote on all matters on which stockholders generally are entitled to vote. Class B and C common stockholders have no right to vote on any matters, except for certain defined matters, including (i) any decision to exit the core payments business, in which case the class B and C common stockholders will vote together with the class A common stockholders in a single class, and (ii) in specified circumstances, any consolidation, merger, combination or similar transaction of the Company, in which case the class B and C common stockholders will vote together as a single class. In either case, the class B and C common stockholders are entitled to cast a number of votes equal to the number of shares of class B or C common stock held multiplied by the applicable conversion rate in effect on the record date. Holders of the Company's common stock have no right to vote on any amendment to the current certificate of incorporation that relates solely to any series of preferred stock. Dividends declared. The Company declared and paid $1.4 billion in dividends in fiscal 2016 at a quarterly rate of $0.14 per share. In October 2016 , the Company’s board of directors declared a quarterly cash dividend of $0.165 per share of class A common stock (determined in the case of class B and C common stock and U.K.&I and Europe preferred stock on an as-converted basis), which will be paid on December 6, 2016 , to all holders of record of the Company’s common and preferred stock as of November 18, 2016 . |
Earnings Per Share
Earnings Per Share | 12 Months Ended |
Sep. 30, 2016 | |
Earnings Per Share [Abstract] | |
Earnings Per Share | Note 15—Earnings Per Share Basic earnings per share is computed by dividing net income available to each class by the weighted-average number of shares of common stock outstanding and participating securities during the period. Net income is allocated to each class of common stock and participating securities based on its proportional ownership on an as-converted basis. The weighted-average number of shares of each class of common stock outstanding reflects changes in ownership over the periods presented. See Note 14—Stockholders' Equity . Diluted earnings per share is computed by dividing net income available by the weighted-average number of shares of common stock outstanding, participating securities and, if dilutive, potential class A common stock equivalent shares outstanding during the period. Dilutive class A common stock equivalents may consist of: (1) shares of class A common stock issuable upon the conversion of U.K.&I and Europe preferred stock and class B and C common stock based on the conversion rates in effect through the period, and (2) incremental shares of class A common stock calculated by applying the treasury stock method to the assumed exercise of employee stock options, the assumed purchase of stock under the Employee Stock Purchase Plan and the assumed vesting of unearned performance shares. The following table presents earnings per share for fiscal 2016 . (1) Basic Earnings Per Share Diluted Earnings Per Share (in millions, except per share data) Income Allocation (A) (2) Weighted- Average Shares Outstanding (B) Earnings per Share = (A)/(B) Income Allocation (A) (2) Weighted- Average Shares Outstanding (B) Earnings per Share = (A)/(B) Class A common stock $ 4,738 1,906 $ 2.49 $ 5,991 2,414 (3) $ 2.48 Class B common stock 1,006 245 $ 4.10 $ 1,004 245 $ 4.09 Class C common stock 185 19 $ 9.94 $ 185 19 $ 9.93 Participating securities (4) 62 Not presented Not presented $ 61 Not presented Not presented Net income $ 5,991 The following table presents earnings per share for fiscal 2015 . (1) Basic Earnings Per Share Diluted Earnings Per Share (in millions, except per share data) Income Allocation (A) (2) Weighted- Average Shares Outstanding (B) Earnings per Share = (A)/(B) Income Allocation (A) (2) Weighted- Average Shares Outstanding (B) Earnings per Share = (A)/(B) Class A common stock $ 5,044 1,954 $ 2.58 $ 6,328 2,457 (3) $ 2.58 Class B common stock 1,045 245 $ 4.26 $ 1,042 245 $ 4.25 Class C common stock 224 22 $ 10.33 $ 223 22 $ 10.30 Participating securities (4) 15 Not presented Not presented $ 15 Not presented Not presented Net income $ 6,328 The following table presents earnings per share for fiscal 2014 . (1) Basic Earnings Per Share Diluted Earnings Per Share (in millions, except per share data) Income Allocation (A) (2) Weighted- Average Shares Outstanding (B) Earnings per Share = (A)/(B) Income Allocation (A) (2) Weighted- Average Shares Outstanding (B) Earnings per Share = (A)/(B) Class A common stock $ 4,307 1,993 $ 2.16 $ 5,438 2,523 (3) $ 2.16 Class B common stock 892 245 $ 3.63 $ 890 245 $ 3.62 Class C common stock 222 26 $ 8.65 $ 221 26 $ 8.62 Participating securities (4) 17 Not presented Not presented $ 16 Not presented Not presented Net income $ 5,438 (1) Figures in the table may not recalculate exactly due to rounding. Earnings per share is calculated based on unrounded numbers. The number of shares and per share amounts for the prior periods presented have been retroactively adjusted to reflect the four -for-one stock split effected in the fiscal second quarter of 2015. See Note 14—Stockholders' Equity . (2) Net income attributable to Visa Inc. is allocated based on proportional ownership on an as-converted basis. The weighted-average number of shares of as-converted class B common stock used in the income allocation were 405 million for fiscal 2016 and 2015 and 413 million for fiscal 2014. The weighted-average number of shares of as-converted class C common stock used in the income allocation was 75 million , 87 million and 103 million for fiscal 2016 , 2015 and 2014 , respectively. (3) Weighted-average diluted shares outstanding are calculated on an as-converted basis, and include incremental common stock equivalents, as calculated under the treasury stock method. The computation includes 5 million , 6 million and 7 million common stock equivalents for fiscal 2016 , 2015 and 2014 , respectively, because their effect would have been dilutive. The computation excludes 2 million of common stock equivalents for fiscal 2016 , 2015 and 2014 because their effect would have been anti-dilutive. (4) Participating securities include preferred stock outstanding and unvested share-based payment awards that contain non-forfeitable rights to dividends or dividend equivalents, such as the Company's U.K.&I and Europe preferred stock, restricted stock awards, restricted stock units and earned performance-based shares. U.K.&I and Europe preferred stock were issued as part of the purchase price consideration in connection with the Visa Europe acquisition and are convertible into a number of shares of class A common stock or class A equivalent preferred stock upon certain conditions. Participating securities' income is allocated based on the weighted-average number of shares of as-converted stock. See Note 2—Acquisition of Visa Europe and Note 14—Stockholders' Equity . |
Share-based Compensation
Share-based Compensation | 12 Months Ended |
Sep. 30, 2016 | |
Share-based Compensation [Abstract] | |
Share-based Compensation | Note 16—Share-based Compensation 2007 Equity Incentive Compensation Plan The Company’s 2007 Equity Incentive Compensation Plan, or the EIP, authorizes the compensation committee of the board of directors to grant non-qualified stock options ("options"), restricted stock awards ("RSAs"), restricted stock units ("RSUs") and performance-based shares to its employees and non-employee directors, for up to 236 million shares of class A common stock. Shares available for award may be either authorized and unissued or previously issued shares subsequently acquired by the Company. The EIP will continue to be in effect until all of the common stock available under the EIP is delivered and all restrictions on those shares have lapsed, unless the EIP is terminated earlier by the Company’s board of directors. In January 2016, the Company's board of directors approved an amendment of the EIP effective February 3, 2016, such that awards may be granted under the plan until January 31, 2022. Share-based compensation cost is recorded net of estimated forfeitures on a straight-line basis for awards with service conditions only, and on a graded-vesting basis for awards with service, performance and market conditions. The Company’s estimated forfeiture rate is based on an evaluation of historical, actual and trended forfeiture data. For fiscal 2016 , 2015 and 2014 , the Company recorded share-based compensation cost related to the EIP of $211 million , $184 million and $172 million , respectively, in personnel on its consolidated statements of operations. The related tax benefits were $62 million , $54 million and $51 million for fiscal 2016 , 2015 and 2014 , respectively. The amount of capitalized share-based compensation cost was immaterial during fiscal 2016 , 2015 and 2014 . All per share amounts and number of shares outstanding presented below reflect the four -for-one stock split that was effected in the second quarter of fiscal 2015. See Note 14—Stockholders' Equity . Options Options issued under the EIP expire 10 years from the date of grant and primarily vest ratably over 3 years from the date of grant, subject to earlier vesting in full under certain conditions. During fiscal 2016 , 2015 and 2014 , the fair value of each stock option was estimated on the date of grant using a Black-Scholes option pricing model with the following weighted-average assumptions: 2016 2015 2014 Expected term (in years) (1) 4.35 4.55 4.80 Risk-free rate of return (2) 1.5 % 1.5 % 1.3 % Expected volatility (3) 21.7 % 22.0 % 25.2 % Expected dividend yield (4) 0.7 % 0.8 % 0.8 % Fair value per option granted $ 15.01 $ 12.04 $ 11.03 (1) This assumption is based on the Company's historical option exercises and those of a set of peer companies that management believes is generally comparable to Visa. The Company's data is weighted based on the number of years between the measurement date and Visa's initial public offering as a percentage of the options' contractual term. The relative weighting placed on Visa's data and peer data in fiscal 2016 was approximately 77% and 23% , respectively, 67% and 33% in fiscal 2015, respectively, and 58% and 42% in fiscal 2014, respectively. (2) Based upon the zero coupon U.S. treasury bond rate over the expected term of the awards. (3) Based on the Company’s implied and historical volatility. The expected volatilities ranged from 20% to 23% in fiscal 2016 , 21% to 23% in fiscal 2015, and 22% to 26% in fiscal 2014. (4) Based on the Company’s annual dividend rate on the date of grant. The following table summarizes the Company’s option activity for fiscal 2016 : Options Weighted- Average Exercise Price Per Share Weighted- Average Remaining Contractual Term (in years) Aggregate Intrinsic Value (1) (in millions) Outstanding at October 1, 2015 9,677,717 $ 28.07 Granted 1,438,048 $ 79.98 Forfeited (463,378 ) $ 21.76 Exercised (1,775,903 ) $ 20.00 Outstanding at September 30, 2016 8,876,484 $ 38.42 5.2 $393 Options exercisable at September 30, 2016 6,204,589 $ 24.87 3.8 $359 Options exercisable and expected to vest at September 30, 2016 (2) 8,582,576 $ 37.35 5.1 $389 (1) Calculated using the closing stock price on the last trading day of fiscal 2016 of $82.70 , less the option exercise price, multiplied by the number of instruments. (2) Applies a forfeiture rate to unvested options outstanding at September 30, 2016 to estimate the options expected to vest in the future. For the options exercised during fiscal 2016 , 2015 and 2014 , the total intrinsic value was $103 million , $134 million and $187 million , respectively, and the tax benefit realized was $35 million , $86 million and $65 million , respectively. As of September 30, 2016 , there was $19 million of total unrecognized compensation cost related to unvested options, which is expected to be recognized over a weighted-average period of approximately 1.4 years. Restricted Stock Awards and Restricted Stock Units RSAs and RSUs issued under the EIP primarily vest ratably over 3 years from the date of grant, subject to earlier vesting in full under certain conditions. Upon vesting, the RSAs are settled in class A common stock on a one-for-one basis. During the vesting period, RSA award recipients are eligible to receive dividends and participate in the same voting rights as those granted to the holders of the underlying class A common stock. Upon vesting, RSUs can be settled in class A common stock on a one-for-one basis or in cash, or a combination thereof, at the Company’s option. The Company does not currently intend to settle any RSUs in cash. During the vesting period, RSU award recipients are eligible to receive dividend equivalents, but do not participate in the voting rights granted to the holders of the underlying class A common stock. The company discontinued granting RSAs in fiscal 2016 but will continue to grant RSUs under the EIP. The fair value and compensation cost before estimated forfeitures for RSAs and RSUs is calculated using the closing price of class A common stock on the date of grant. The weighted-average grant-date fair value of RSAs granted during fiscal 2015 and 2014 was $63.71 and $49.98 , respectively. No RSAs were granted during fiscal 2016 . The weighted-average grant-date fair value of RSUs granted during fiscal 2016 , 2015 and 2014 was $79.77 , $62.88 and $49.44 , respectively. The total grant-date fair value of RSAs and RSUs vested during fiscal 2016 , 2015 and 2014 was $142 million , $132 million and $126 million , respectively. The following table summarizes the Company's RSA and RSU activity for fiscal 2016 : Restricted Stock Weighted- Average Grant Date Fair Value Weighted- Average Remaining Contractual Term (in years) Aggregate Intrinsic Value (1) (in millions) Awards Units RSA RSU RSA RSU RSA RSU Outstanding at October 1, 2015 4,064,687 1,442,522 $ 54.09 $ 53.80 Granted — 2,735,115 $ — $ 79.77 Vested (2,061,406 ) (789,180 ) $ 49.06 $ 51.58 Forfeited (236,699 ) (241,503 ) $ 59.34 $ 73.02 Outstanding at September 30, 2016 1,766,582 3,146,954 $ 59.26 $ 75.48 0.8 1.7 $146 $260 (1) Calculated by multiplying the closing stock price on the last trading day of fiscal 2016 of $82.70 by the number of instruments. At September 30, 2016 , there was $54 million and $140 million of total unrecognized compensation cost related to unvested RSAs and RSUs, respectively, which is expected to be recognized over a weighted-average7 period of approximately 0.8 years for RSAs and 1.7 years for RSUs. Performance-based Shares The following table summarizes the maximum number of performance-based shares which could be earned and related activity for fiscal 2016 : Shares Weighted- Average Grant Date Fair Value Weighted- Average Remaining Contractual Term (in years) Aggregate Intrinsic Value (1) (in millions) Outstanding at October 1, 2015 1,263,962 $ 57.61 Granted (2) 604,219 $ 92.71 Vested and earned (645,320 ) $ 54.59 Unearned (123,387 ) $ 54.59 Forfeited (57,462 ) $ 73.07 Outstanding at September 30, 2016 1,042,012 $ 78.24 0.9 $86 (1) Calculated by multiplying the closing stock price on the last trading day of fiscal 2016 of $82.70 by the number of instruments. (2) Represents the maximum number of performance-based shares which could be earned. For the Company's performance-based shares, in addition to service conditions, the ultimate number of shares to be earned depends on the achievement of both performance and market conditions. The performance condition is based on the Company's earnings per share target. The market condition is based on the Company's total shareholder return ranked against that of other companies that are included in the Standard & Poor's 500 Index. The fair value of the performance-based shares, incorporating the market condition, is estimated on the grant date using a Monte Carlo simulation model. The grant-date fair value of performance-based shares granted in fiscal 2016 , 2015 and 2014 was $92.71 , $69.78 and $56.37 per share, respectively. Earned performance shares granted in fiscal 2016 , 2015 and 2014 vest approximately 3 years from the initial grant date. All performance awards are subject to earlier vesting in full under certain conditions. Compensation cost for performance-based shares is initially estimated based on target performance. It is recorded net of estimated forfeitures and adjusted as appropriate throughout the performance period. At September 30, 2016 , there was $18 million of total unrecognized compensation cost related to unvested performance-based shares, which is expected to be recognized over a weighted-average period of approximately 0.9 years. Employee Stock Purchase Plan In January 2015, the Company's class A stockholders approved the Visa Inc. Employee Stock Purchase Plan (the “ESPP”), under which substantially all employees are eligible to participate. The ESPP permits eligible employees to purchase the Company’s class A common stock at a 15% discount of the stock price on the purchase date, subject to certain restrictions. A total of 20 million shares of class A common stock have been reserved for issuance under the ESPP. The first offering date was April 1, 2015. The ESPP does not have a material impact on the consolidated financial statements. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Sep. 30, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments and Contingencies | Note 17—Commitments and Contingencies Commitments. The Company leases certain premises and equipment throughout the world with varying expiration dates. The Company incurred total rent expense of $134 million , $136 million and $134 million in fiscal 2016 , 2015 and 2014 , respectively. Future minimum payments on leases, and marketing and sponsorship agreements per fiscal year, at September 30, 2016 , are as follows: 2017 2018 2019 2020 2021 Thereafter Total (in millions) Operating leases $ 126 $ 103 $ 82 $ 61 $ 57 $ 190 $ 619 Marketing and sponsorships 126 128 120 110 38 33 555 Total $ 252 $ 231 $ 202 $ 171 $ 95 $ 223 $ 1,174 Select sponsorship agreements require the Company to spend certain minimum amounts for advertising and marketing promotion over the life of the contract. For commitments where the individual years of spend are not specified in the contract, the Company has estimated the timing of when these amounts will be spent. In addition to the fixed payments stated above, select sponsorship agreements require the Company to undertake marketing, promotional or other activities up to stated monetary values to support events which the Company is sponsoring. The stated monetary value of these activities typically represents the value in the marketplace, which may be significantly higher than the actual costs incurred by the Company. Client incentives. The Company has agreements with financial institution clients and other business partners for various programs designed to build payments volume, increase Visa product acceptance and win merchant routing transactions. These agreements, with terms ranging from one year to sixteen years, can provide card issuance and/or conversion support, volume/growth targets and marketing and program support based on specific performance requirements. These agreements are designed to encourage client business and to increase overall Visa- payment and transaction volume, thereby reducing per-unit transaction processing costs and increasing brand awareness for all Visa clients. Payments made that qualify for capitalization and obligations incurred under these programs are reflected in the consolidated balance sheet. Client incentives are recognized primarily as a reduction to operating revenue in the period the related volumes and transactions occur, based on management's estimate of the client's performance in accordance with the terms of the incentive agreement. The agreements may or may not limit the amount of client incentive payments. The table below sets forth the expected future reduction of revenue per fiscal year for client incentive agreements in effect at September 30, 2016 : (in millions) 2017 2018 2019 2020 2021 Thereafter Total Client incentives $ 4,211 $ 3,752 $ 3,211 $ 2,628 $ 2,245 $ 4,617 $ 20,664 The amount of client incentives recorded as a reduction of revenue in future periods under the Company's incentive arrangements, will be greater or less than the estimates above due to changes in performance expectations, actual client performance, amendments to existing contracts or the execution of new contracts. Based on these agreements, increases in incentive payments are generally driven by increased payment and transaction volume, and as a result, in the event incentive payments exceed the above estimates, such payments are not expected to have a material effect on the Company's financial condition, results of operations or cash flows. Deferred purchase consideration. On June 21, 2016, we acquired 100% of the share capital of Visa Europe. In connection with the purchase, we will pay an additional €1.0 billion , plus 4% compound annual interest, on the third anniversary of the Closing. See Note 2—Acquisition of Visa Europe to our consolidated financial statements. |
Related Parties
Related Parties | 12 Months Ended |
Sep. 30, 2016 | |
Related Party Transactions [Abstract] | |
Related Parties | Note 18—Related Parties Visa considers an entity to be a related party for purposes of this disclosure if that entity owns more than 10% of Visa’s total voting common stock at the end of the fiscal year, or if an officer or employee of that entity also serves on the Company's board of directors. The Company considers an investee to be a related party if the Company’s: (i) ownership interest in the investee is greater than or equal to 10% or (ii) if the investment is accounted for under the equity method of accounting. At September 30, 2016 and 2015 , no entity owned more than 10% of the Company’s total voting common stock. There were no significant transactions with related parties during fiscal 2016 , 2015 and 2014 . |
Income Taxes
Income Taxes | 12 Months Ended |
Sep. 30, 2016 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Note 19—Income Taxes The Company’s income before taxes by fiscal year consisted of the following: 2016 2015 2014 (in millions) U.S. $ 5,839 $ 7,214 $ 6,140 Non-U.S. 2,173 1,781 1,584 Total income before taxes $ 8,012 $ 8,995 $ 7,724 U.S. income before taxes included $2.5 billion , $2.4 billion and $2.3 billion of the Company's U.S. entities' income from operations outside of the U.S. for fiscal 2016 , 2015 and 2014 , respectively. Income tax provision by fiscal year consisted of the following: 2016 2015 2014 (in millions) Current: U.S. federal $ 2,250 $ 1,991 $ 2,353 State and local 181 168 237 Non-U.S. 368 300 274 Total current taxes 2,799 2,459 2,864 Deferred: U.S. federal (508 ) 181 (576 ) State and local (63 ) 1 (31 ) Non-U.S. (207 ) 26 29 Total deferred taxes (778 ) 208 (578 ) Total income tax provision $ 2,021 $ 2,667 $ 2,286 The tax effect of temporary differences that give rise to significant portions of deferred tax assets and liabilities at September 30, 2016 and 2015 , are presented below: 2016 2015 (in millions) Deferred Tax Assets: Accrued compensation and benefits $ 277 $ 141 Comprehensive (income) loss 106 51 Accrued litigation obligation 373 391 Client incentives 266 191 Net operating loss carryforwards 32 50 Federal benefit of state taxes 195 203 Federal benefit of foreign taxes 1,214 — Other 280 185 Valuation allowance (31 ) (40 ) Deferred tax assets 2,712 1,172 Deferred Tax Liabilities: Property, equipment and technology, net (278 ) (315 ) Intangible assets (7,013 ) (3,964 ) Foreign taxes (106 ) (153 ) Other (101 ) — Deferred tax liabilities (7,498 ) (4,432 ) Net deferred tax liabilities $ (4,786 ) $ (3,260 ) The increase in the net deferred tax liabilities primarily reflect the deferred tax impacts of the intangible assets acquired in the Visa Europe acquisition. At September 30, 2016 and 2015, net deferred tax assets of $22 million and $13 million , respectively, are reflected in other assets on the consolidated balance sheets. In November 2015, the FASB issued Accounting Standards Update 2015-17, which simplifies the presentation of deferred income taxes by requiring that deferred tax assets and liabilities be presented as non-current. The standard impacts presentation only. The Company elected to early adopt the standard on a retrospective basis effective October 1, 2015, and all deferred tax assets and liabilities are classified as non-current on the Company’s consolidated balance sheets. All prior period amounts have been reclassified to conform with the current period presentation. In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that all or some portion of the deferred tax assets will not be realized. The ultimate realization of the deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences are deductible. The fiscal 2016 and 2015 valuation allowances relate primarily to foreign net operating losses from subsidiaries acquired in recent years. As of September 30, 2016 , the Company had $17 million federal, $21 million state and $117 million foreign net operating loss carryforwards. The federal and state net operating loss carryforwards will expire in fiscal 2028 through 2035 . The foreign net operating loss may be carried forward indefinitely. The Company expects to fully utilize the federal and state net operating loss carryforwards in future years. As of September 30, 2016, the Company had $15 million of federal foreign tax credit carryforwards, which will expire in fiscal 2026. The Company expects to realize the benefit of the credit carryforwards in future years. The income tax provision differs from the amount of income tax determined by applying the applicable U.S. federal statutory rate of 35% to pretax income, as a result of the following: For the Years Ended September 30, 2016 2015 2014 Dollars Percent Dollars Percent Dollars Percent (in millions, except percentages) U.S. federal income tax at statutory rate $ 2,804 35 % $ 3,148 35 % $ 2,704 35 % State income taxes, net of federal benefit 135 2 % 194 2 % 129 2 % Non-U.S. tax effect, net of federal benefit (553 ) (7 )% (327 ) (4 )% (278 ) (4 )% Prior years U.S. domestic production activities deduction — — % — — % (191 ) (2 )% Remeasurement of deferred tax liability (88 ) (1 )% — — % — — % Reversal of prior years tax reserves related to the resolution of uncertain tax positions — — % (239 ) (2 )% — — % Revaluation of Visa Europe put option (89 ) (1 )% — — % — — % Other, net (188 ) (3 )% (109 ) (1 )% (78 ) (1 )% Income tax provision $ 2,021 25 % $ 2,667 30 % $ 2,286 30 % The effective income tax rate was 25% in fiscal 2016 and 30% in fiscal 2015 . The effective tax rate in fiscal 2016 differs from the effective tax rate in fiscal 2015 primarily due to: • the effect of one-time items related to the Visa Europe acquisition, the most significant of which was the $1.9 billion U.S. loss related to the effective settlement of the Framework Agreement between Visa and Visa Europe. These one-time items impacted the geographic mix of global income, resulting in a reduced effective tax rate; • an $88 million one-time tax benefit due to the remeasurement of deferred tax liabilities as a result of the reduction in the U.K. tax rate enacted in fiscal 2016; • the non-taxable $255 million revaluation of the Visa Europe put option recorded in fiscal 2016; and • the absence of a $296 million tax benefit recognized in fiscal 2015 resulting from the resolution of uncertain tax positions with taxing authorities. Included in the $296 million was a one-time $239 million tax benefit that related to prior fiscal years. The effective income tax rates were 30% in fiscal 2015 and 2014 . The following highlights the significant tax items recorded in each respective year: • the aforementioned $296 million tax benefit recognized in fiscal 2015; and • a $264 million tax benefit recognized in fiscal 2014 related to a deduction for U.S. domestic production activities, of which $191 million was a one-time tax benefit related to prior fiscal years. Current income taxes receivable were $232 million and $77 million at September 30, 2016 and 2015 , respectively. Non-current income taxes receivable of $731 million and $627 million were included in other assets at September 30, 2016 and 2015 , respectively. See Note 5—Prepaid Expenses and Other Assets . At September 30, 2016 and 2015 , income taxes payable of $153 million and $75 million , respectively, were included in accrued income taxes as part of accrued liabilities, and accrued income taxes of $911 million and $752 million , respectively, were included in other long-term liabilities. See Note 8—Accrued and Other Liabilities . Cumulative undistributed earnings of the Company’s international subsidiaries that are intended to be reinvested indefinitely outside the United States amounted to $8.3 billion at September 30, 2016 . The amount of income taxes that would have resulted had such earnings been repatriated is not practicably determinable. The Company’s largest operating hub outside the United States is located in Singapore. It operates under a tax incentive agreement which is effective through September 30, 2023, and is conditional upon meeting certain business operations and employment thresholds in Singapore. The tax incentive agreement decreased Singapore tax by $235 million , $192 million and $168 million , and the benefit of the tax incentive agreement on diluted earnings per share was $0.10 , $0.08 and $0.07 in fiscal 2016 , 2015 and 2014 , respectively. In accordance with Accounting Standards Codification 740—Income Taxes , the Company is required to inventory, evaluate and measure all uncertain tax positions taken or to be taken on tax returns, and to record liabilities for the amount of such positions that may not be sustained, or may only partially be sustained, upon examination by the relevant taxing authorities. At September 30, 2016 and 2015 , the Company’s total gross unrecognized tax benefits were $1.2 billion and $1.1 billion , respectively, exclusive of interest and penalties described below. Included in the $1.2 billion and $1.1 billion are $926 million and $859 million of unrecognized tax benefits, respectively, that if recognized, would reduce the effective tax rate in a future period. A reconciliation of beginning and ending unrecognized tax benefits by fiscal year is as follows: 2016 2015 (in millions) Beginning balance at October 1 $ 1,051 $ 1,303 Increases of unrecognized tax benefits related to prior years 153 44 Decreases of unrecognized tax benefits related to prior years (180 ) (413 ) Increases of unrecognized tax benefits related to current year 138 120 Reductions related to lapsing statute of limitations (2 ) (3 ) Ending balance at September 30 $ 1,160 $ 1,051 It is the Company’s policy to account for interest expense and penalties related to uncertain tax positions in non-operating expense in its consolidated statements of operations. The Company recognized $15 million and $10 million of interest expense in fiscal 2016 and 2014, respectively, and reversed $6 million of interest expense in fiscal 2015, related to uncertain tax positions. The Company accrued $3 million , $1 million and $2 million of penalties in fiscal 2016, 2015 and 2014, respectively, related to uncertain tax positions. At September 30, 2016 and 2015 , the Company had accrued interest of $61 million and $33 million , respectively, and accrued penalties of $17 million and $6 million , respectively, related to uncertain tax positions in its other long-term liabilities. At September 30, 2016, accrued interest and penalties balances included amounts related to the Visa Europe acquisition. The Company's fiscal 2009 through 2012 U.S. federal income tax returns are currently under Internal Revenue Service ("IRS") examination. The Company has filed a federal refund claim for fiscal year 2008, which is also currently under IRS examination. Except for the refund claim, the federal statutes of limitations have expired for fiscal years prior to 2009. The Company's fiscal 2006, 2007 and 2008 California tax returns are currently under examination. Except for certain outstanding refund claims, the California statutes of limitations have expired for fiscal years prior to 2006. During fiscal 2013, the Canada Revenue Agency (CRA) completed its examination of the Company's fiscal 2003 through 2009 Canadian tax returns and proposed certain assessments. Based on the findings of its examination, the CRA also proposed certain assessments to the Company's fiscal 2010 through 2015 Canadian tax returns. The Company filed notices of objection against these assessments and, in fiscal 2015, completed the appeals process without reaching a settlement with the CRA. In April 2016, the Company petitioned the Tax Court of Canada to overturn the CRA's assessments. The Company continues to believe that its income tax provision adequately reflects its obligations to the CRA. The Company is also subject to examinations by various state and foreign tax authorities. All material state and foreign tax matters have been concluded for years through fiscal 2002. The timing and outcome of the final resolutions of the federal, state and foreign tax examinations and refund claims are uncertain. As such, it is not reasonably possible to estimate the impact that the final outcomes could have on the Company's unrecognized tax benefits in the next 12 months. |
Legal Matters
Legal Matters | 12 Months Ended |
Sep. 30, 2016 | |
Legal Matters [Abstract] | |
Legal Matters | Note 20—Legal Matters The Company is party to various legal and regulatory proceedings. Some of these proceedings involve complex claims that are subject to substantial uncertainties and unascertainable damages. Accordingly, except as disclosed, the Company has not established reserves or ranges of possible loss related to these proceedings, as at this time in the proceedings, the matters do not relate to a probable loss and/or the amount or range of losses are not reasonably estimable. Although the Company believes that it has strong defenses for the litigation and regulatory proceedings described below, it could, in the future, incur judgments or fines or enter into settlements of claims that could have a material adverse effect on the Company's financial position, results of operations or cash flows. From time to time, the Company may engage in settlement discussions or mediations with respect to one or more of its outstanding litigation matters, either on its own behalf or collectively with other parties. The litigation accrual is an estimate and is based on management's understanding of its litigation profile, the specifics of each case, advice of counsel to the extent appropriate and management's best estimate of incurred loss as of the balance sheet date. The following table summarizes the activity related to accrued litigation. Fiscal 2016 Fiscal 2015 (in millions) Balance at October 1 $ 1,024 $ 1,456 Provision for uncovered legal matters 2 14 Accrual for VE territory covered litigation 2 — Payments on legal matters (47 ) (446 ) Balance at September 30 $ 981 $ 1,024 Accrual Summary—U.S. Covered Litigation Visa Inc., Visa U.S.A. and Visa International are parties to certain legal proceedings that are covered by the U.S. retrospective responsibility plan, which the Company refers to as the U.S. covered litigation. See Note 3—U.S. and Europe Retrospective Responsibility Plans . An accrual for the U.S. covered litigation and a charge to the litigation provision are recorded when loss is deemed to be probable and reasonably estimable. In making this determination, the Company evaluates available information, including but not limited to actions taken by the litigation committee. The total accrual related to the U.S. covered litigation could be either higher or lower than the escrow account balance. The following table summarizes the activity related to U.S. covered litigation. Fiscal 2016 Fiscal 2015 (in millions) Balance at October 1 $ 1,023 $ 1,449 Payments on U.S. covered litigation (45 ) (426 ) Balance at September 30 $ 978 $ 1,023 On January 14, 2014, the MDL 1720 court entered a final judgment order approving a settlement with class plaintiffs in the interchange multidistrict litigation proceedings, which is subject to the outcome of any appeals. Following the payment of approximately $4.0 billion from the U.S. litigation escrow account into settlement funds pursuant to the class settlement agreement, on January 27, 2014, Visa received and deposited into the Company's U.S. litigation escrow account "takedown payments" of approximately $1.1 billion , which Visa was entitled to receive under the class settlement agreement based on payment card sales volume attributable to merchants who opted out. The deposit into the U.S. litigation escrow account and a related increase in accrued litigation to address opt-out claims were recorded in the second quarter of fiscal 2014. An additional accrual of $450 million associated with these opt-out claims was recorded in the fourth quarter of fiscal 2014. Payments totaling $ 528 million were made from fiscal 2014 through 2016 from the U.S. litigation escrow account reflecting settlements with a number of individual opt-out merchants, resulting in an accrued balance of $978 million related to U.S. covered litigation as of September 30, 2016. See further discussion below under Individual Merchant Interchange Litigation and Note 3—U.S. and Europe Retrospective Responsibility Plans . Accrual Summary—VE Territory Covered Litigation Visa Inc., Visa International and Visa Europe are parties to certain legal proceedings that are covered by the Europe retrospective responsibility plan. Unlike the U.S. retrospective responsibility plan, the Europe retrospective responsibility plan does not have an escrow account that is used to fund settlements or judgments. The Company is entitled to recover VE territory covered losses through a periodic adjustment to the conversion rates applicable to the U.K.&I preferred stock and Europe preferred stock. An accrual for the VE territory covered losses and a reduction to stockholders' equity will be recorded when the loss is deemed to be probable and reasonably estimable. See further discussion below under VE Territory Covered Litigation and Note 3-U.S. and Europe Retrospective Responsibility Plans . The following table summarizes the activity related to VE territory covered litigation. Fiscal 2016 (in millions) Balance at October 1 $ — Accrual for VE territory covered litigation 2 Balance at September 30 $ 2 Interchange Multidistrict Litigation (MDL) Beginning in May 2005, a series of complaints (the majority of which were styled as class actions) were filed in U.S. federal district courts by merchants against Visa U.S.A., Visa International and/or MasterCard, and in some cases, certain Visa member financial institutions. The complaints challenged, among other things, Visa's and MasterCard's purported setting of interchange reimbursement fees, their "no surcharge" rules, and alleged tying and bundling of transaction fees under the federal antitrust laws, and, in some cases, certain state unfair competition laws. The Judicial Panel on Multidistrict Litigation issued an order transferring the cases to the U.S. District Court for the Eastern District of New York for coordination of pre-trial proceedings in MDL 1720. A group of purported class plaintiffs subsequently filed a Second Consolidated Amended Class Action Complaint which, together with the complaints brought by individual merchants, sought money damages alleged to range in the tens of billions of dollars (subject to trebling), as well as attorneys' fees and injunctive relief. The class plaintiffs also filed a Second Supplemental Class Action Complaint against Visa Inc. and certain member financial institutions challenging Visa's reorganization and IPO under the antitrust laws and seeking unspecified money damages and declaratory and injunctive relief, including an order that the IPO be unwound. The Company and certain individual merchants whose claims were consolidated with the MDL signed a settlement agreement to resolve their claims against the Company for approximately $350 million . This payment was made from the U.S. litigation escrow account on October 29, 2012, and the court has dismissed those claims with prejudice. In addition, Visa Inc., Visa U.S.A., Visa International, MasterCard Incorporated, MasterCard International Incorporated, various U.S. financial institution defendants, and the class plaintiffs signed a settlement agreement (the "2012 Settlement Agreement") to resolve the class plaintiffs' claims. The terms of the 2012 Settlement Agreement include, among other terms, (1) a comprehensive release of claims asserted in the litigation and protection against future litigation regarding default interchange and other U.S. rules; (2) settlement payments from the Company of approximately $4.0 billion and a further distribution of 10 basis points of default interchange for an eight-month period; (3) certain modifications to the Company's rules, including modifications to permit surcharging on credit transactions under certain circumstances; and (4) the Company's agreement to meet with merchant buying groups that seek to collectively negotiate interchange rates. On December 10, 2012, Visa paid approximately $4.0 billion from the U.S. litigation escrow account into a settlement fund established pursuant to the 2012 Settlement Agreement. On January 14, 2014, the court entered a final judgment order approving the settlement, from which a number of objectors appealed. On June 30, 2016, the U.S. Court of Appeals for the Second Circuit vacated the lower court's certification of the merchant class and reversed the approval of the settlement. The Second Circuit determined that the class plaintiffs were inadequately represented, and remanded the case to the lower court for further proceedings not inconsistent with its decision. Prior to November 23, 2016, class plaintiffs may file a petition for writ of certiorari with the U.S. Supreme Court seeking review of the Second Circuit's decision. Until the appeals process is complete, it is uncertain whether the Company will be able to resolve the class plaintiffs' claims as contemplated by the 2012 Settlement Agreement. However, the case is still U.S. covered litigation for purposes of the U.S. retrospective responsibility plan. See Note 3—U.S. and Europe Retrospective Responsibility Plans . Consumer Interchange Litigation On December 16, 2013, a putative class action was filed on behalf of all Visa and MasterCard payment cardholders in the United States since January 1, 2000, against certain financial institutions, identifying non-defendants Visa, MasterCard and certain other financial institutions as co-conspirators. Plaintiffs allege primarily a conspiracy to fix interchange fees and seek injunctive relief, attorneys’ fees and treble damages in excess of $54.0 billion dollars annually arising from purported overcharges. Originally filed in federal court in California, the case was transferred to MDL 1720. On November 26, 2014, the MDL court dismissed plaintiffs' federal law claim and declined to exercise jurisdiction over plaintiffs' state law claim. Both sides asked the court to reconsider aspects of its decision and filed notices of appeal. On February 24, 2016, the MDL court denied plaintiffs' motion for reconsideration of the dismissal of plaintiffs' federal claim and dismissed plaintiffs' state law claim based on defendants' cross-motion for reconsideration. On October 17, 2016, the U.S. Court of Appeals for the Second Circuit affirmed the dismissal of plaintiffs' claims, and on October 31, 2016, plaintiffs sought rehearing by the Second Circuit. Individual Merchant Interchange Litigation Beginning in May 2013, more than 50 cases have been filed in various federal district courts by hundreds of merchants who had opted out of the damages portion of the 2012 Settlement Agreement, generally pursuing damages claims on allegations similar to those raised in MDL 1720. A number of the cases also include allegations that Visa has monopolized, attempted to monopolize, and/or conspired to monopolize debit card-related market segments. In addition, some of the cases seek an injunction against the setting of default interchange rates; certain Visa Rules relating to merchants, including the honor-all-cards rule; and various transaction fees, including the fixed acquirer network fee. One merchant's complaint also asserts that Visa, MasterCard and their member banks conspired to prevent the adoption of chip-and-PIN authentication in the U.S. or otherwise circumvent competition in the debit market, and at least two merchant groups have requested permission from the MDL court to amend their complaints. The cases name as defendants Visa Inc., Visa U.S.A., Visa International, MasterCard Incorporated and MasterCard International Incorporated, although some also include certain U.S. financial institutions as defendants. Wal-Mart Stores Inc. and its subsidiaries filed a complaint that also adds Visa Europe Limited and Visa Europe Services Inc. as defendants. Visa, MasterCard, and certain U.S. financial institution defendants in MDL 1720 filed a complaint in the Eastern District of New York against certain named class representative plaintiffs who had opted out or stated their intention to opt out of the damages portion of the 2012 Settlement Agreement. In addition, Visa filed three more similar complaints in the Eastern District of New York against Wal-Mart Stores Inc.; against The Home Depot, Inc. and Home Depot U.S.A.; and against Sears Holdings Corporation. All four complaints seek a declaration that, from January 1, 2004 to November 27, 2012, the time period for which opt-outs could seek damages under the 2012 Settlement Agreement, Visa's conduct in, among other things, continuing to set default interchange rates, maintaining its "honor all cards" rule, enforcing certain rules relating to merchants, and restructuring itself, did not violate federal or state antitrust laws. All the cases filed in federal court have been either assigned to the judge presiding over MDL 1720, or have been transferred or are being considered for transfer by the Judicial Panel on Multidistrict Litigation for inclusion in MDL 1720. The court has entered an order confirming that In re Payment Card Interchange Fee and Merchant Discount Antitrust Litigation , 1:05-md-01720-JG-JO (E.D.N.Y.), includes (1) all current and future actions transferred to MDL 1720 by the Judicial Panel on Multidistrict Litigation or other order of any court for inclusion in coordinated or pretrial proceedings, and (2) all actions filed in the Eastern District of New York that arise out of operative facts as alleged in the cases subject to the transfer orders of the Judicial Panel on Multidistrict Litigation. Cases that have been transferred to or otherwise included in MDL 1720 are U.S. covered litigation for purposes of the U.S. retrospective responsibility plan. See Note 3—U.S. and Europe Retrospective Responsibility Plans . A settlement agreement was reached with Wal-Mart Stores Inc. and its subsidiaries, which will terminate if, following all appeals, the 2012 Settlement Agreement in MDL 1720 is reversed or vacated with respect to certification of the Rule 23(b)(2) settlement class or the consideration provided to or release provided by that class. Including this settlement with Wal-Mart, as of the date of filing, Visa has reached settlement agreements with a number of merchants representing approximately 51% of the Visa-branded payment card sales volume of merchants who opted out of the 2012 Settlement Agreement. Except for the settlement with Wal-Mart, these settlement agreements remain effective despite the outcome of any appeals from the district court's order approving the 2012 Settlement Agreement in MDL 1720. On June 13, 2016, The Home Depot, Inc. and Home Depot U.S.A., Inc. filed suit against Visa Inc., Visa U.S.A., Visa International, MasterCard Incorporated and MasterCard International Incorporated in the U.S. District Court for the Northern District of Georgia. On October 3, 2016, the Judicial Panel on Multidistrict Litigation issued an order transferring the case to MDL 1720. While the Company believes that it has substantial defenses in these matters, the final outcome of individual legal claims is inherently unpredictable. The Company could incur judgments, enter into settlements or revise its expectations regarding the outcome of individual merchant claims, and such developments could have a material adverse effect on our financial results in the period in which the effect becomes probable and reasonably estimable. VE Territory Covered Litigation U.K. Merchant Litigation Since July 2013, in excess of 100 Merchants (the capitalized term "Merchant," when used in this section, means a merchant together with subsidiary/affiliate companies) have commenced proceedings against Visa Europe, Visa Inc. and Visa International relating to interchange rates in Europe, and seek damages for alleged anti-competitive conduct primarily in relation to U.K. domestic and/or Irish domestic and/or intra-EEA interchange fees for credit and debit cards. As of the filing date, Visa Europe, Visa Inc. and Visa International have settled the claims asserted by two Merchants, and one Merchant has dropped all claims that relate to debit cards. After a successful application for summary judgment and an unsuccessful appeal by the claimants, the claims of U.K. merchants should be limited to the six-year period immediately preceding the issuance of each claim. In November 2016, claims filed by a number of Merchants in 2013 are scheduled to go to trial to determine whether Visa has infringed U.K. competition law and is liable for having set interchange fee rates during the relevant time period. If the Merchants prevail, the amount of any loss they have suffered will be determined in a separate trial in the future. In addition, over 30 additional Merchants have threatened to commence similar proceedings. Standstill agreements have been entered into with respect to some of those Merchants’ claims. While the amount of interchange being challenged could be substantial, these claims have not yet been filed and their full scope is not yet known. The Company has learned that several additional European entities have indicated that they may also bring similar claims and we anticipate additional claims in the future. Although not all of the merchant claims have been served and thus the full scope of the claims is not yet known, and there are substantial defenses to these claims, the total damages sought in the claims that have been issued, served and preserved likely amounts to several billion dollars. Other Litigation "Indirect Purchaser" Actions From 2000 to 2004, complaints were filed on behalf of consumers in nineteen different states and the District of Columbia against Visa and MasterCard. The complaints alleged, among other things, that Visa's "honor all cards" rule and a similar MasterCard rule violated state antitrust and consumer protection laws and common law. The claims in these class actions asserted that merchants, faced with excessive merchant discount fees, passed on some portion of those fees to consumers in the form of higher prices on goods and services sold. Plaintiffs sought money damages and injunctive relief. Visa has been successful in the majority of these cases, and has resolved the cases in all jurisdictions but California. In California, the consolidated Credit/Debit Card Tying Cases were resolved pursuant to a revised settlement agreement that received final approval and was affirmed on appeal. Certain objectors filed petitions for rehearing and for review by the California Supreme Court that were denied on February 11, 2015, and the judgment approving the settlement agreement is now final. One objector has appealed the trial court's orders regarding the distribution of certain settlement funds, and the denial of that objector's motion for attorneys' fees and costs. On December 1, 2015, the objector's appeal from the trial court's order regarding the distribution of certain settlement funds was dismissed. The appeal of the denial of the objector's motion for attorneys' fees and costs is pending. European Commission Proceedings Inter-regional Interchange Investigation. Following the issuance of a Statement of Objections in 2009 concerning, among other things, the alleged default application of Visa Inc.'s inter-regional interchange fees to intra-regional and domestic consumer debit and credit card transactions in the European Economic Area ("EEA"), the European Commission ("EC") served a Supplementary Statement of Objections ("SSO") on Visa Inc. and Visa International in 2013. The SSO concerned, in particular, the application of Visa Inc.'s inter-regional interchange fees to transactions involving a Visa credit card issued outside the EEA and a merchant located in the EEA. The EC claims that these fees violate competition law in the EEA. The SSO indicates that the EC may impose fines. The potential amount of any fine cannot be estimated at this time. All issues relating to intra-regional or domestic consumer debit and credit card transactions acquired in the EEA have been settled by commitments offered by Visa Europe Limited in 2010 and 2014 and endorsed by the EC. Following its acquisition of Visa Europe Limited in June 2016, these commitments are now binding upon Visa Inc. The EC's case regarding Visa Inc.'s inter-regional interchange fees is still ongoing. DCC Investigation. In 2013, the EC opened an investigation against Visa Europe, based on a complaint alleging that Visa Europe's pricing of and rules relating to Dynamic Currency Conversion (DCC) transactions infringe EU competition rules. This investigation is pending. Canadian Competition Proceedings Merchant Litigation . Beginning in December 2010, a number of class action lawsuits were filed in Quebec, British Columbia, Ontario, Saskatchewan and Alberta against Visa Canada, MasterCard and ten financial institutions on behalf of merchants that accept payment by Visa and/or MasterCard credit cards. A separate action was filed against Visa Canada Corporation and Visa Inc., two MasterCard entities and smaller Canadian issuing banks, but that case has been stayed. The remaining cases allege a violation of Canada's price-fixing law and various common law claims based on separate Visa and MasterCard conspiracies in respect of default interchange and certain of the networks' rules. Four of the named financial institutions, only one of which is a significant Canadian issuer, have now settled with the plaintiffs. On March 26, 2014, the British Columbia Supreme Court, in one of the class action suits noted above, Watson v. Bank of America Corporation, et al. , granted the plaintiff's application for class certification in part. On appeal from both the defendants and the plaintiff, the British Columbia Court of Appeal allowed the class proceedings to advance but limited the time period of plaintiff's main price-fixing claim to prior to March 2010. A motion by the plaintiff to amend its claim to include the post-March 2010 period was dismissed by the British Columbia Supreme Court and that ruling is under appeal. The related lawsuits in Ontario, Alberta, and Saskatchewan have effectively been stayed pending further proceedings in British Columbia. The timing of the lawsuit in Quebec is also being considered in light of the proceedings in British Columbia. The pending lawsuits largely seek unspecified monetary damages and injunctive relief, but some allege substantial damages. Data Pass Litigation On November 19, 2010, a consumer filed an amended class action complaint against Webloyalty.com, Inc., Gamestop Corporation, and Visa Inc. in Connecticut federal district court, seeking damages, restitution and injunctive relief on the grounds that consumers who made online purchases at merchants were allegedly deceived into incurring charges for services from Webloyalty.com through the unauthorized passing of cardholder account information during the sales transaction ("data pass"), in violation of federal and state consumer protection statutes and common law. On October 15, 2015, the court dismissed the case in its entirety, without leave to replead. Plaintiff filed a notice of appeal on November 12, 2015. U.S. ATM Access Fee Litigation National ATM Council Class Action . In October 2011, the National ATM Council and thirteen non-bank ATM operators filed a purported class action lawsuit against Visa (Visa Inc., Visa International, Visa U.S.A. and Plus System, Inc.) and MasterCard in the U.S. District Court for the District of Columbia. The complaint challenges Visa's rule (and a similar MasterCard rule) that if an ATM operator chooses to charge consumers an access fee for a Visa or Plus transaction, that fee cannot be greater than the access fee charged for transactions on other networks. Plaintiffs claim that the rule violates Section 1 of the Sherman Act, and seeks damages "in an amount not presently known, but which is tens of millions of dollars, prior to trebling," injunctive relief and attorneys’ fees. Consumer Class Actions . In October 2011, a purported consumer class action was filed against Visa and MasterCard in the same federal court challenging the same ATM access fee rules. Two other purported consumer class actions challenging the rules, later combined, were also filed in October 2011 in the same federal court naming Visa, MasterCard and three financial institutions as defendants. Plaintiffs seek treble damages, restitution, injunctive relief, and attorneys' fees where available under federal and state law, including under Section 1 of the Sherman Act and consumer protection statutes. On February 13, 2013, the court granted the defendants’ motions to dismiss and dismissed all of these cases without prejudice. On plaintiffs' appeal, the U.S. Court of Appeals for the District of Columbia Circuit vacated the lower court's decisions and remanded for further proceedings. On February 18, 2016, the National ATM Council moved for a preliminary injunction to prohibit Visa and MasterCard from imposing ATM access fee non-discrimination rules. On June 28, 2016, the U.S. Supreme Court granted defendants' petitions for writ of certiorari seeking review of the decisions of the U.S. Court of Appeals for the District of Columbia Circuit, and the district court issued an order on July 21, 2016, staying the cases pending that review. The U.S. Supreme Court is scheduled to hear oral argument in these cases on December 7, 2016. U.S. Department of Justice Civil Investigative Demand On March 13, 2012, the Antitrust Division of the United States Department of Justice (the " Division " ) issued a Civil Investigative Demand, or " CID, " to Visa Inc. seeking documents and information regarding a potential violation of Section 1 or 2 of the Sherman Act, 15 U.S.C. §§ 1, 2. The CID focuses on PIN-Authenticated Visa Debit and Visa's competitive responses to the Dodd-Frank Act, including Visa's fixed acquirer network fee. Visa is cooperating with the Division in connection with the CID. Federal Trade Commission Voluntary Access Letter . The Bureau of Competition of the United States Federal Trade Commission (the " Bureau " ) has closed its inquiry regarding potential violations of certain regulations associated with the Dodd-Frank Act focusing on Visa's optional PIN Debit Gateway Service. Notice Regarding EMV Chip Debit Cards . On July 28, 2016, the Bureau notified Visa that the Bureau is conducting an investigation into whether Visa's requirements for EMV chip inhibit merchant routing choice for debit card transactions. Visa is cooperating with the Bureau. Pulse Network On November 25, 2014, Pulse Network LLC filed suit against Visa Inc. in federal district court in Texas. Pulse alleges that Visa has monopolized and attempted to monopolize debit card network services markets. Pulse also alleges that Visa has entered into agreements in restraint of trade, engaged in unlawful exclusive dealing and tying, violated the Texas Free Enterprise and Antitrust Act and engaged in tortious interference with prospective business relationships. Pulse seeks unspecified treble damages, attorneys' fees and injunctive relief, including to enjoin the fixed acquirer network fee structure, Visa's conduct regarding PIN-Authenticated Visa Debit and Visa agreements with merchants and acquirers relating to debit acceptance. On January 23, 2015, Visa filed a motion to dismiss the complaint. On December 17, 2015, the court denied Visa's motion to dismiss the complaint, and the case remains pending. New Mexico Attorney General On December 23, 2014, a case similar to MDL 1720 was filed in New Mexico state court by New Mexico's attorney general on behalf of the state, state agencies and citizens of the state, generally pursuing claims on allegations similar to those raised in MDL 1720. On May 15, 2015, defendants filed a partial motion to dismiss, which the court granted in part and, among other things, narrowed the state antitrust damages claims. EMV Chip Liability Shift Following their initial complaint filed on March 8, 2016, B&R Supermarket, Inc., d/b/a Milam's Market, and Grove Liquors LLC filed an amended class action complaint on July 15, 2016, against Visa Inc., Visa U.S.A., MasterCard, Discover, American Express, EMVCo and certain financial institutions in the U.S. District Court for the Northern District of California. The amended complaint asserts that defendants, through EMVCo, conspired to shift liability for fraudulent, faulty or otherwise rejected consumer credit card transactions from defendants to the purported class of merchants, defined as those merchants throughout the United States who have been subject to the "Liability Shift" from October 2015 to the present. Plaintiffs claim that the so-called "Liability Shift" violates Sections 1 and 3 of the Sherman Act and certain state laws, and seek treble damages, injunctive relief and attorneys' fees. On September 30, 2016, the court granted motions to dismiss the amended complaint filed by EMVCo and the financial institution defendants, but denied motions to dismiss filed by Visa Inc., Visa U.S.A., MasterCard, American Express and Discover. Walmart Acceptance Agreement On May 10, 2016, Wal-Mart Stores Inc. and various affiliates ("Walmart") filed a lawsuit against Visa U.S.A. in New York County Supreme Court. Walmart seeks a declaratory judgment that certain of its practices related to the acceptance of Visa debit cards did not previously and would not in the future constitute a breach of the acceptance agreement entered into between Walmart and Visa. Walmart also seeks attorneys' fees and a declaratory judgment that certain of Visa's actions violated the same agreement. On June 29, 2016, Visa answered the complaint and filed counterclaims seeking declaratory and injunctive relief, as well as costs and other remedies. In its counterclaims, Visa alleges that certain of Walmart's conduct and practices relating to the acceptance of Visa debit cards constitute a breach of the acceptance agreement and a breach of the implied duty of good faith and fair dealing, and that Walmart fraudulently induced Visa to enter into the acceptance agreement. On August 19, 2016, Walmart moved to dismiss Visa’s counterclaim for fraudulent inducement. Kroger On June 27, 2016, The Kroger Co. ("Kroger") filed a lawsuit against Visa Inc. in the U.S. District Court for the Southern District of Ohio. In its complaint, Kroger seeks a declaratory judgment that certain of Visa's rules related to the acceptance of Visa debit cards are inconsistent with the Dodd-Frank Act. Kroger also seeks damages and other relief related to certain state law claims. On August 11, 2016, Visa filed a motion to dismiss the complaint. On September 15, 2016, Kroger filed its opposition to Visa’s motion to dismiss, arguing, among other things, that Kroger seeks a declaratory judgment that Kroger has not breached its contract with Visa. Broadway Grill On July 12, 2016, Broadway Grill, Inc. ("Broadway Grill"), on behalf of itself and a putative class of California merchants that have accepted Visa-branded cards since January 1, 2004, filed a lawsuit against Visa Inc., Visa International and Visa U.S.A. in California state court. Based on allegations similar to those advanced by plaintiffs in MDL 1720, Broadway Grill pursues claims under California state antitrust and unfair business statutes. Broadway Grill seeks damages, costs and other remedies. On July 18, 2016, the case was removed to the U.S. District Court for the Northern District of California. On September 27, 2016, the district court granted leave to amend the complaint and entered an order remanding the case to California state court. Thereafter, Broadway Grill amended its complaint and Visa sought permission from the U.S. Court of Appeals for the Ninth Circuit to appeal the district court’s decision. On October 17, 2016, the district court ordered the case remanded to California state court, and Visa's request for permission to appeal is pending. |
Summary of Significant Accoun29
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Sep. 30, 2016 | |
Accounting Policies [Abstract] | |
Organization | Organization . In a series of transactions from October 1 to October 3, 2007, Visa Inc. (Visa or the Company) undertook a reorganization in which Visa U.S.A. Inc. (Visa U.S.A.), Visa International Service Association (Visa International), Visa Canada Corporation (Visa Canada) and Inovant LLC (Inovant) became direct or indirect subsidiaries of Visa and established the U.S. retrospective responsibility plan (the October 2007 reorganization or reorganization). See Note 3—U.S. and Europe Retrospective Responsibility Plans . The reorganization was reflected as a single transaction on October 1, 2007 using the purchase method of accounting with Visa U.S.A. as the accounting acquirer. Visa Europe Limited (Visa Europe) did not become a subsidiary of Visa Inc., but rather remained owned and governed by its European member financial institutions. On June 21, 2016, the Company acquired 100% of the share capital of Visa Europe. The Company's consolidated statements of operations do not reflect the financial results of Visa Europe for the 10 days from the acquisition date through June 30, 2016 as the impact was immaterial. See Note 2—Acquisition of Visa Europe . Visa is a global payments technology company that connects consumers, merchants, financial institutions, businesses, strategic partners and governments in more than 200 countries and territories to fast, secure and reliable electronic payments. Visa and its wholly-owned consolidated subsidiaries, including Visa U.S.A., Visa International, Visa Worldwide Pte. Limited (VWPL), Visa Europe Limited (Visa Europe), Visa Canada, Inovant and CyberSource Corporation (CyberSource), operate one of the world's largest retail electronic payments network — VisaNet — which facilitates authorization, clearing and settlement of payment transactions and enables us to provide our financial institution and merchant clients a wide range of products, platforms and value-added services. VisaNet also offers fraud protection for account holders and assured payment for merchants. Visa is not a bank and does not issue cards, extend credit or set rates and fees for account holders on Visa products. In most cases, account holder and merchant relationships belong to, and are managed by, Visa's financial institution clients. |
Basis of presentation | Consolidation and basis of presentation . The consolidated financial statements include the accounts of Visa and its consolidated entities and are presented in accordance with accounting principles generally accepted in the United States of America (“U.S. GAAP”). The Company consolidates its majority-owned and controlled entities, including variable interest entities (“VIEs”) for which the Company is the primary beneficiary. The Company's investments in VIEs have not been material to its consolidated financial statements as of and for the periods presented. All significant intercompany accounts and transactions are eliminated in consolidation. On March 18, 2015, the Company completed a four -for-one split of its class A common stock effected in the form of a stock dividend. All per share amounts and number of shares outstanding in the consolidated financial statements and accompanying notes are presented on a post-split basis. See Note 14—Stockholders' Equity . |
Consolidation | The Company's activities are interrelated, and each activity is dependent upon and supportive of the other. All significant operating decisions are based on analysis of Visa as a single global business. Accordingly, the Company has one reportable segment, Payment Services. |
Use of estimates | Use of estimates . The preparation of consolidated financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions about future events. These estimates and assumptions affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and reported amounts of revenues and expenses during the reporting period. Future actual results could differ materially from these estimates. The use of estimates in specific accounting policies is described further below as appropriate. |
Cash and cash equivalents | Cash and cash equivalents . Cash and cash equivalents include cash and certain highly liquid investments with original maturities of 90 days or less from the date of purchase. Cash equivalents are primarily recorded at cost, which approximates fair value due to their generally short maturities. |
Restricted cash--U.S. litigation escrow | Restricted cash—U.S. litigation escrow . The Company maintains an escrow account from which monetary liabilities from settlements of, or judgments in, the U.S. covered litigation are paid. See Note 3—U.S. and Europe Retrospective Responsibility Plans and Note 20—Legal Matters for a discussion of the U.S. covered litigation. The escrow funds are held in money market investments, together with the interest earned, less applicable taxes payable, and classified as restricted cash on the consolidated balance sheets. Interest earned on escrow funds is included in non-operating income on the consolidated statements of operations. |
Investments | Investments and fair value. The Company measures certain assets and liabilities at fair value. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. Fair value measurements are reported under a three-level valuation hierarchy. See Note 4—Fair Value Measurements and Investments . The classification of the Company’s financial assets and liabilities within the hierarchy is as follows: Level 1 —Inputs to the valuation methodology are unadjusted quoted prices in active markets for identical assets or liabilities. The Company’s Level 1 assets include money market funds, publicly-traded equity securities and U.S. Treasury securities. Level 2 —Inputs to the valuation methodology can include: (1) quoted prices in active markets for similar (not identical) assets or liabilities; (2) quoted prices for identical or similar assets in non-active markets; (3) inputs other than quoted prices that are observable for the asset or liability; or (4) inputs that are derived principally from or corroborated by observable market data. The Company's Level 2 assets and liabilities include commercial paper, U.S. government-sponsored debt securities, corporate debt securities and foreign exchange derivative instruments. Level 3 —Inputs to the valuation methodology are unobservable and cannot be corroborated by observable market data. The Company's Level 3 assets and liabilities included auction rate securities and the Visa Europe put option at September 30, 2015. Trading investment securities include mutual fund equity security investments related to various employee compensation and benefit plans. Trading activity in these investments is at the direction of the Company's employees. These investments are held in a trust and are not available for the Company's operational or liquidity needs. Interest and dividend income and changes in fair value are recorded in non-operating income, and offset in personnel expense on the consolidated statements of operations. Available-for-sale investment securities include investments in debt and equity securities. These securities are recorded at cost at the time of purchase and are carried at fair value. The Company considers these securities to be available-for-sale to meet working capital and liquidity needs. Investments with original maturities of greater than 90 days and stated maturities of less than one year from the balance sheet date, or investments that the Company intends to sell within one year, are classified as current assets, while all other securities are classified as non-current assets. These investments are generally available to meet short-term liquidity needs. Unrealized gains and losses are reported in accumulated other comprehensive income or loss on the consolidated balance sheets until realized. The specific identification method is used to calculate realized gain or loss on the sale of marketable securities, which is recorded in non-operating income on the consolidated statements of operations. Dividend and interest income are recognized when earned and are included in non-operating income on the consolidated statements of operations. The Company evaluates its debt and equity securities for other-than-temporary impairment, or OTTI, on an ongoing basis. When there has been a decline in fair value of a debt or equity security below the amortized cost basis, the Company recognizes OTTI if: (1) it has the intent to sell the security; (2) it is more likely than not that it will be required to sell the security before recovery of the amortized cost basis; or (3) it does not expect to recover the entire amortized cost basis of the security. The Company applies the equity method of accounting for investments in other entities when it holds between 20% and 50% ownership in the entity or when it exercises significant influence. Under the equity method, the Company’s share of each entity’s profit or loss is reflected in non-operating income on the consolidated statements of operations. The equity method of accounting is also used for flow-through entities such as limited partnerships and limited liability companies when the investment ownership percentage is equal to or greater than 5% of outstanding ownership interests, regardless of whether the Company has significant influence over the investees. The Company applies the cost method of accounting for investments in other entities when it holds less than 20% ownership in the entity and does not exercise significant influence, or for flow-through entities when the investment ownership is less than 5% and the Company does not exercise significant influence. These investments consist of equity holdings in non-public companies and are recorded in other assets on the consolidated balance sheets. The Company regularly reviews investments accounted for under the cost and equity methods for possible impairment, which generally involves an analysis of the facts and changes in circumstances influencing the investment, expectations of the entity’s cash flows and capital needs, and the viability of its business model. |
Financial instruments | Financial instruments . The Company considers the following to be financial instruments: cash and cash equivalents, restricted cash-U.S. litigation escrow, trading and available-for-sale investment securities, settlement receivable and payable, customer collateral, non-marketable equity investments, settlement risk guarantee, and derivative instruments. See Note 4—Fair Value Measurements and Investments . |
Settlement receivable and payable | Settlement receivable and payable . The Company operates systems for authorizing, clearing and settling payment transactions worldwide. Most U.S. dollar settlements with the Company's financial institution clients are settled within the same day and do not result in a receivable or payable balance, while settlements in currencies other than the U.S. dollar generally remain outstanding for one to two business days, resulting in amounts due from and to clients.These amounts are presented as settlement receivable and settlement payable on the consolidated balance sheets. |
Customer collateral | Customer collateral . The Company holds cash deposits and other non-cash assets from certain clients in order to ensure their performance of settlement obligations arising from Visa payment products are processed in accordance with the Company's rules. The cash collateral assets are restricted and fully offset by corresponding liabilities and both balances are presented on the consolidated balance sheets, excluding cash collateral held by Visa Europe as its clients retain beneficial ownership and the cash is only accessible to the Company in the event of default by the client on its settled obligations. Non-cash collateral assets are held on behalf of the Company by a third party and are not recorded on the consolidated balance sheets. See Note 11—Settlement Guarantee Management . |
Property, equipment and technology, net | Property, equipment and technology, net . Property, equipment and technology are recorded at historical cost less accumulated depreciation and amortization, which are computed on a straight-line basis over the asset’s estimated useful life. Depreciation and amortization of technology, furniture, fixtures and equipment are computed over estimated useful lives ranging from 2 to 10 years. Capital leases are amortized over the lease term and leasehold improvements are amortized over the shorter of the useful life of the asset or lease term. Building improvements are depreciated between 3 and 40 years, and buildings are depreciated over 40 years. Improvements that increase functionality of the asset are capitalized and depreciated over the asset’s remaining useful life. Land and construction-in-progress are not depreciated. Fully depreciated assets are retained in property, equipment and technology, net, until removed from service. Technology includes purchased and internally developed software, including technology assets obtained through acquisitions. Internally developed software represents software primarily used by the VisaNet electronic payments network. Internal and external costs incurred during the preliminary project stage are expensed as incurred. Qualifying costs incurred during the application development stage are capitalized. Once the project is substantially complete and ready for its intended use these costs are amortized on a straight-line basis over the technology's estimated useful life. Acquired technology assets are initially recorded at fair value and amortized on a straight-line basis over the estimated useful life. The Company evaluates the recoverability of long-lived assets for impairment annually or more frequently if events or changes in circumstances indicate that the carrying amount of an asset or asset group may not be recoverable. If the sum of expected undiscounted net future cash flows is less than the carrying amount of an asset or asset group, an impairment loss is recognized to the extent that the carrying amount of the asset or asset group exceeds its fair value. See Note 6—Property, Equipment and Technology, Net . |
Leases | Leases . The Company enters into operating and capital leases for the use of premises, software and equipment. Rent expense related to operating lease agreements, which may or may not contain lease incentives, is primarily recorded on a straight-line basis over the lease term. |
Intangible assets, net | Intangible assets, net . The Company records identifiable intangible assets at fair value on the date of acquisition and evaluates the useful life of each asset. Finite-lived intangible assets primarily consist of customer relationships, reacquired rights, reseller relationships and trade names obtained through acquisitions. Finite-lived intangible assets are amortized on a straight-line basis and are tested for recoverability if events or changes in circumstances indicate that their carrying amounts may not be recoverable. These intangibles have useful lives ranging from 3 to 15 years. No events or changes in circumstances indicate that impairment existed as of September 30, 2016 . See Note 7—Intangible Assets and Goodwill . Indefinite-lived intangible assets consist of trade name, customer relationships and reacquired rights. Intangible assets with indefinite useful lives are not amortized but are evaluated for impairment annually or more frequently if events or changes in circumstances indicate that impairment may exist. The Company first assesses qualitative factors to determine whether it is necessary to perform a quantitative impairment test for indefinite-lived intangible assets. The Company assesses each category of indefinite-lived intangible assets for impairment on an aggregate basis, which may require the allocation of cash flows and/or an estimate of fair value to the assets or asset group. Impairment exists if the fair value of the indefinite-lived intangible asset is less than the carrying value. The Company relies on a number of factors when completing impairment assessments, including a review of discounted net future cash flows, business plans and the use of present value techniques. The Company completed its annual impairment review of indefinite-lived intangible assets as of February 1, 2016 , and concluded there was no impairment as of that date. No recent events or changes in circumstances indicate that impairment of the Company's indefinite-lived intangible assets existed as of September 30, 2016 . |
Goodwill | Goodwill . Goodwill represents the excess of the purchase price over the fair value of the net assets acquired in a business combination. Goodwill is not amortized but is evaluated for impairment at the reporting unit level annually as of February 1, or more frequently if events or changes in circumstances indicate that impairment may exist. The Company evaluated its goodwill for impairment on February 1, 2016 , and concluded there was no impairment as of that date. No recent events or changes in circumstances indicate that impairment existed as of September 30, 2016 . |
Accrued litigation | Accrued litigation . The Company evaluates the likelihood of an unfavorable outcome in legal or regulatory proceedings to which it is a party and records a loss contingency when it is probable that a liability has been incurred and the amount of the loss can be reasonably estimated. These judgments are subjective, based on the status of such legal or regulatory proceedings, the merits of the Company's defenses and consultation with corporate and external legal counsel. Actual outcomes of these legal and regulatory proceedings may differ materially from the Company's estimates. The Company expenses legal costs as incurred in professional fees in the consolidated statements of operations. See Note 20—Legal Matters . |
Revenue recognition | Revenue recognition . The Company's operating revenues are comprised principally of service revenues, data processing revenues, international transaction revenues and other revenues, reduced by costs incurred under client incentives arrangements. The Company recognizes revenue, net of sales and other similar taxes, when the price is fixed or determinable, persuasive evidence of an arrangement exists, the service is performed and collectability of the resulting receivable is reasonably assured. Service revenues consist of revenues earned for services provided in support of client usage of Visa products. Current quarter service revenues are primarily assessed using a calculation of current pricing applied to the prior quarter's payments volume. The Company also earns revenues from assessments designed to support ongoing acceptance and volume growth initiatives, which are recognized in the same period the related volume is transacted. Data processing revenues consist of revenues earned for authorization, clearing, settlement, network access and other maintenance and support services that facilitate transaction and information processing among the Company's clients globally. Data processing revenues are recognized in the same period the related transactions occur or services are rendered. International transaction revenues are earned for cross-border transaction processing and currency conversion activities. Cross-border transactions arise when the country of origin of the issuer is different from that of the merchant. International transaction revenues are primarily generated by cross-border payments and cash volume. Other revenues consist mainly of license fees for use of the Visa brand, revenues earned from Visa Europe in connection with the Visa Europe Framework Agreement (see Note 2—Acquisition of Visa Europe ) prior to the acquisition of Visa Europe, fees for account holder services, licensing and certification and other activities related to the Company's acquired entities. Other revenues also include optional service or product enhancements, such as extended account holder protection and concierge services. Other revenues are recognized in the same period the related transactions occur or services are rendered. |
Client incentives | Client incentives. The Company enters into long-term contracts with financial institution clients, merchants and strategic partners for various programs designed to build payments volume, increase Visa product acceptance, win merchant routing transactions over Visa's network and drive innovation. These incentives are primarily accounted for as reductions to operating revenues or as operating expenses if a separate identifiable benefit at fair value can be established. The Company generally capitalizes advance incentive payments under these agreements if select criteria are met. The capitalization criteria include the existence of future economic benefits to Visa, the existence of legally enforceable recoverability language (e.g., early termination clauses), management's ability and intent to enforce the recoverability language and the ability to generate future earnings from the agreement in excess of amounts deferred. Capitalized amounts are amortized over the shorter of the period of contractual recoverability or the corresponding period of economic benefit. Incentives not yet paid are accrued systematically and rationally based on management's estimate of each client's performance. These accruals are regularly reviewed and estimates of performance are adjusted, as appropriate, based on changes in performance expectations, actual client performance, amendments to existing contracts or the execution of new contracts. See Note 17—Commitments and Contingencies . |
Marketing | Marketing. The Company expenses costs for the production of advertising as incurred. The cost of media advertising is expensed when the advertising takes place. Sponsorship costs are recognized over the period in which the Company benefits from the sponsorship rights. Promotional items are expensed as incurred, when the related services are received, or when the related event occurs. |
Income taxes | Income taxes . The Company's income tax expense consists of two components: current and deferred. Current income tax expense represents taxes paid or payable for the current period. Deferred tax assets and liabilities are recognized to reflect the future tax consequences attributable to temporary differences between the financial statement carrying amounts and the respective tax basis of existing assets and liabilities, and operating loss and credit carryforwards. Deferred tax assets and liabilities are measured using enacted tax rates expected to apply to taxable income in the years in which those temporary differences are expected to be recovered or settled. In assessing whether deferred tax assets are realizable, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. A valuation allowance is recorded for the portions that are not expected to be realized based on the level of historical taxable income, projections of future taxable income over the periods in which the temporary differences are deductible, and qualifying tax planning strategies. Where interpretation of the tax law may be uncertain, the Company recognizes, measures and discloses income tax uncertainties. The Company accounts for interest expense and penalties related to uncertain tax positions as non-operating expense in the consolidated statements of operations. The Company files a consolidated federal income tax return and, in certain states, combined state tax returns. The Company elects to claim foreign tax credits in any given year if such election is beneficial to the Company. See Note 19—Income Taxes . |
Pension and other postretirement benefit plans | Pension and other postretirement benefit plans . The Company’s defined benefit pension and other postretirement benefit plans are actuarially evaluated, incorporating various critical assumptions including the discount rate and the expected rate of return on plan assets (for qualified pension plans). The discount rate is based on a cash flow matching analysis, with the projected benefit payments matching spot rates from a yield curve developed from high-quality corporate bonds. The expected rate of return on pension plan assets considers the current and expected asset allocation, as well as historical and expected returns on each plan asset class. Any difference between actual and expected plan experience, including asset return experience, in excess of a 10% corridor is recognized in net periodic pension cost over the expected average employee future service period, which is approximately 9 years for the U.S. plans and 12 years for the Visa Europe U.K. pension plan. Other assumptions involve demographic factors such as retirement age, mortality, attrition and the rate of compensation increases. The Company evaluates assumptions annually and modifies them as appropriate. The Company recognizes the funded status of its benefit plans in its consolidated balance sheets as other assets, accrued liabilities and other liabilities. The Company recognizes settlement losses when it settles pension benefit obligations, including making lump-sum cash payments to plan participants in exchange for their rights to receive specified pension benefits, when certain thresholds are met. See Note 10—Pension, Postretirement and Other Benefits . |
Foreign currency remeasurement and translation | Foreign currency remeasurement and translation . The Company's functional currency is the U.S. dollar for the majority of its foreign operations except for Visa Europe whose functional currency is the euro. Transactions denominated in currencies other than the applicable functional currency are converted to the functional currency at the exchange rate on the transaction date. At period end, monetary assets and liabilities are remeasured to the functional currency using exchange rates in effect at the balance sheet date. Non-monetary assets and liabilities are remeasured at historical exchange rates. Resulting foreign currency transaction gains and losses related to conversion and remeasurement are recorded in general and administrative expense in the consolidated statements of operations and were not material for fiscal 2016, 2015 and 2014. Where a non-U.S. currency is the functional currency, translation from that functional currency to the U.S. dollar is performed for balance sheet accounts using exchange rates in effect at the balance sheet date and for revenue and expense accounts using an average exchange rate for the period. Resulting translation adjustments are reported as a component of accumulated other comprehensive income or loss on the consolidated balance sheets. |
Derivative financial instruments | Derivative financial instruments . The Company uses foreign exchange forward derivative contracts to reduce its exposure to foreign currency rate changes on forecasted non-functional currency denominated operational cash flows. Derivatives are carried at fair value on a gross basis in either prepaid and other current assets or accrued liabilities on the consolidated balance sheets. At September 30, 2016, derivatives outstanding mature within 18 months or less. Gains and losses resulting from changes in fair value of designated derivative instruments are accounted for either in accumulated other comprehensive income or loss on the consolidated balance sheets, or in the consolidated statements of operations in the corresponding account where revenue or expense is hedged, or to general and administrative for hedge amounts determined to be ineffective. Gains and losses resulting in changes in fair value of derivative instruments not designated for hedge accounting are recorded in general and administrative for hedges of operating activity, or non-operating income (expense) for hedges of non-operating activity. See Note 12—Derivative and Non-derivative Financial Instruments . |
Non-derivative Financial Instrument Designated as a Net Investment Hedge | Non-derivative financial instrument designated as a net investment hedge. The Company designated the euro-denominated deferred cash consideration liability, a non-derivative financial instrument, as a hedge against a portion of the Company's euro-denominated net investment in Visa Europe. See Note 2—Acquisition of Visa Europe . Changes in the value of the deferred cash consideration liability, attributable to the change in exchange rates at the end of each reporting period, partially offset the foreign currency translation adjustments resulting from the euro-denominated net investment, are reported as a component of accumulated other comprehensive income or loss on the Company's consolidated balance sheet. See Note 12—Derivative and Non-derivative Financial Instruments . |
Guarantees and indemnifications | Guarantees and indemnifications . The Company recognizes an obligation at inception for guarantees and indemnifications that qualify for recognition, regardless of the probability of occurrence. The Company indemnifies its financial institution clients for settlement losses suffered due to the failure of any other client to fund its settlement obligations in accordance with the Visa Rules. The estimated fair value of the liability for settlement indemnification is included in accrued liabilities on the consolidated balance sheets and is described in Note 11—Settlement Guarantee Management . |
Share-based compensation | Share-based compensation . The Company recognizes share-based compensation cost using the fair value method of accounting. The Company recognizes compensation cost for awards with only service conditions on a straight-line basis over the requisite service period, which is generally the vesting period. Compensation cost for performance and market-condition-based awards is recognized on a graded-vesting basis. The amount is initially estimated based on target performance and is adjusted as appropriate based on management's best estimate throughout the performance period. See Note 16—Share-based Compensation . |
Earnings per share | Earnings per share . The Company calculates earnings per share using the two-class method to reflect the different rights of each class and series of outstanding common stock. The dilutive effect of incremental common stock equivalents is reflected in diluted earnings per share by application of the treasury stock method. See Note 15—Earnings Per Share . |
Recently Issued Accounting Pronouncements | Recently Issued Accounting Pronouncements In May 2014, the Financial Accounting Standards Board ("FASB") issued ASU No. 2014-09, which requires an entity to recognize the amount of revenue to which it expects to be entitled for the transfer of goods or services to customers. The ASU will replace existing revenue recognition guidance in U.S. GAAP when it becomes effective. In August 2015, the FASB issued ASU No. 2015-14, which defers the effective date of ASU No. 2014-09 by one year. In March 2016, the FASB issued ASU 2016-08, which clarifies the implementation guidance on principal versus agent considerations under the new revenue recognition standard. In April 2016, the FASB issued ASU 2016-10, which clarifies the implementation guidance on identifying promised goods or services and on determining whether an entity's promise to grant a license with either a right to use the entity's intellectual property (which is satisfied at a point in time) or a right to access the entity's intellectual property (which is satisfied over time). In May 2016, the FASB issued ASU 2016-11, which rescinds certain SEC staff observer comments upon adoption of ASU 2014-09, including the SEC comments related to consideration given by a vendor to a customer. In May 2016, the FASB also issued ASU 2016-12, which provides narrow scope improvements and technical expedients on assessing collectibility, presentation of sales taxes, evaluating contract modifications and completed contracts at the time of transition and the disclosure requirement for the effect of the accounting change for the period of adoption.The Company will adopt the standard effective October 1, 2018. The standard permits the use of either the retrospective or cumulative effect transition method. The Company has not yet selected a transition method and is evaluating the full effect that ASU 2014-09 and all of its related subsequent updates will have on its consolidated financial statements and related disclosures. In June 2014, the FASB issued ASU No. 2014-12, which requires a performance target in stock compensation awards that affects vesting, and is achievable after the requisite service period, be treated as a performance condition. The Company will adopt the standard effective October 1, 2016. The adoption is not expected to have a material impact on the consolidated financial statements. In April 2015, the FASB issued ASU No. 2015-03, which simplifies the presentation of debt issuance costs by requiring that debt issuance costs be presented in the balance sheet as a direct deduction from the carrying amount of debt liability, consistent with debt discounts and premiums. Subsequently, in August 2015, the FASB issued ASU No. 2015-15, which adds SEC staff guidance on the presentation of debt issuance costs related to line-of-credit arrangements, allowing for the deferral and presentation of debt issuance costs as an asset and subsequent amortization of the deferred debt issuance costs ratably over the term of the line-of-credit arrangement, regardless of whether there are any outstanding borrowings on the line-of-credit arrangement. The Company elected to early adopt the standards effective October 1, 2015 and the carrying amount of the Company's debt liability is presented net of issuance costs on the consolidated financial statements. See Note 9—Debt . In April 2015, the FASB issued ASU No. 2015-05, which provides guidance about a customer's accounting for fees paid in a cloud computing arrangement. The amendment will help entities evaluate whether such an arrangement includes a software license, which should be accounted for consistent with the acquisition of other software licenses; otherwise, it should be accounted for as a service contract. The Company will adopt the standard effective October 1, 2016. The adoption is not expected to have a material impact on the consolidated financial statements. In September 2015, the FASB issued ASU No. 2015-16, which simplifies the accounting for post-acquisition adjustments by eliminating the requirement to retrospectively account for the adjustments made to provisional amounts recognized in a business combination. The Company elected to early adopt this guidance on a prospective basis effective October 1, 2015. The adoption did not have a material impact on the consolidated financial statements. In November 2015, the FASB issued ASU 2015-17, which simplifies the presentation of deferred income taxes by requiring that deferred tax assets and liabilities be presented as non-current. The standard impacts presentation only. The Company elected to early adopt the standard on a retrospective basis effective October 1, 2015 and all deferred tax assets and liabilities are classified as non-current. Previously, current deferred tax assets had been presented separately and current deferred tax liabilities had been included in accrued liabilities on the consolidated balance sheets. All prior period amounts within the consolidated financial statements have been reclassified to conform to current period presentation. The reclassification did not affect the Company's total equity, operating revenues, net income, comprehensive income or cash flows as of and for the periods presented. The adoption did not have a material impact on the consolidated financial statements. In January 2016, the FASB issued ASU 2016-01, which amends certain aspects of recognition, measurement, presentation and disclosure of financial instruments, including the requirement to measure certain equity investments at fair value with changes in fair value recognized in net income. The Company will adopt the standard effective October 1, 2018. The adoption is not expected to have a material impact on the consolidated financial statements. In February 2016, the FASB issued ASU 2016-02, which requires the recognition of lease assets and lease liabilities arising from operating leases in the statement of financial position. The Company will adopt the standard effective October 1, 2019 and does not anticipate that this new accounting guidance will have a material impact on its consolidated statement of operations. The Company estimates the value of leased assets and liabilities that may be recognized could be in the hundreds of millions of dollars. The actual impact will depend on the Company's lease portfolio at the time of adoption. In March 2016, the FASB issued ASU 2016-05, which clarifies that a change in the counterparty to a derivative instrument that has been designated as the hedging instrument under Topic 815, Derivatives and Hedging, does not, in and of itself, require dedesignation of that hedging relationship provided that all other hedge accounting criteria continue to be met. The Company will adopt the standard effective October 1, 2017. The adoption is not expected to have a material impact on the consolidated financial statements. In March 2016, the FASB issued ASU 2016-06, which clarifies the requirements for assessing whether contingent call/put options that can accelerate the payment of principal on debt instruments are clearly and closely related to their debt hosts. An entity performing the assessment is required to assess the embedded call/put options solely in accordance with a four-step decision sequence. The Company will adopt the standard effective October 1, 2017. The adoption is not expected to have a material impact on the consolidated financial statements. In March 2016, the FASB issued ASU 2016-07, which eliminates the requirement that an entity retroactively adopt the equity method of accounting if an investment qualifies for use of the equity method as a result of an increase in the level of ownership or degree of influence. The equity method investor is required to add the cost of acquiring the additional interest in the investee to the current basis of the investor's previously held interest and adopt the equity method of accounting as of the date the investment becomes qualified for equity method accounting. The Company will adopt the standard effective October 1, 2017. The adoption is not expected to have a material impact on the consolidated financial statements. In March 2016, the FASB issued ASU 2016-09, which simplifies several aspects of the accounting for share-based payments, including immediate recognition of all excess tax benefits and deficiencies in the income statement, changing the threshold to qualify for equity classification up to the employees' maximum statutory tax rates, allowing an entity-wide accounting policy election to either estimate the number of awards that are expected to vest or account for forfeitures as they occur, and clarifying the classification on the statement of cash flows for the excess tax benefit and employee taxes paid when an employer withholds shares for tax-withholding purposes. The Company will early adopt the standard effective October 1, 2016. The adoption is not expected to have a material impact on the consolidated financial statements. In May 2016, the FASB issued ASU 2016-13, which amends guidance on reporting credit losses for assets held at amortized cost basis and available-for-sale debt securities. The amendment requires a financial asset measured at amortized cost basis to be presented at the net amount expected to be collected. The amendment in this update also requires that credit losses on available-for-sale debt securities be presented as an allowance rather than as a write-down. The measurement of credit losses for newly recognized financial assets and subsequent changes in the allowance for credit losses are recorded in the statement of income. The Company is evaluating the full effect that ASU 2016-13 will have on its consolidated financial statements and will adopt the standard effective October 1, 2020. In August 2016, the FASB issued ASU 2016-15, which provides guidance on eight specific cash flow issues, including debt prepayments or debt extinguishment costs. The Company will adopt the standard effective October 1, 2018. The adoption is not expected to have a material impact on the consolidated financial statements. In October 2016, the FASB issued ASU 2016-16, which requires that entities recognize the income tax consequences of an intra-entity transfer of an asset, other than inventory, when the transfer occurs. The Company is evaluating the effect that ASU 2016-16 will have on its consolidated financial statements and is considering early adoption of the standard. |
Visa Europe (Tables)
Visa Europe (Tables) | 12 Months Ended |
Sep. 30, 2016 | |
Business Combinations [Abstract] | |
Schedule of Purchase Consideration | The following table details the purchase consideration: Accounting Purchase Consideration (in millions) Cash payment $ 13,882 Fair value of preferred stock (1) 5,692 Total upfront consideration $ 19,574 Fair value of deferred cash consideration (2) 1,236 Total consideration before adjustments $ 20,810 Less: Visa Europe Framework Agreement loss (3) (1,856 ) Less: Treasury stock (4) (170 ) Total accounting purchase consideration $ 18,784 (1) The fair value of preferred stock was determined based on its as-converted value of $6.1 billion on June 21, 2016, less a 6% discount for illiquidity as these shares are subject to limitations on transferability. The fair value was also adjusted to reflect $25 million of "right to recover for covered losses" related to VE territory covered losses prior to the Closing. See Note 20—Legal Matters . (2) This amount reflects the fair value of deferred cash consideration of € 1.0 billion , plus 4.0% compound annual interest, payable on the third anniversary of the Closing, discounted at a rate of 1.2% . At September 30, 2016, the deferred consideration of $1.2 billion reflects interest accretion recognized during the three months ended September 30, 2016, more than offset by the impact of changes in the euro to U.S. dollar exchange rate from the Closing. Total consideration has been adjusted to account for the following items to arrive at the accounting purchase consideration: (3) the loss upon consummation of the transaction resulting from the effective settlement of the Framework Agreement between Visa and Visa Europe. The Visa Europe Framework Agreement provided Visa Europe with a perpetual, exclusive right to operate the Visa business in the Visa Europe region in exchange for a license fee paid to Visa. Under the terms of the Framework Agreement, the license fee paid by Visa Europe has increased modestly since inception in 2007, while the value of the Visa Europe business has increased at a greater rate. Using an income approach, the Company assessed the contractual terms and conditions of the Framework Agreement as compared to current market conditions and the historical and expected financial performance of Visa Europe. Based on the analysis performed, the Company determined that the terms were not at fair value as determined under U.S. GAAP at the Closing. The present value of the expected differential between payments required by the Framework Agreement and those that would be required if the contract were at fair value under U.S. GAAP was calculated over the Framework Agreement's contractual perpetual term, resulting in a loss of $1.9 billion recognized within operating expense in the Company's consolidated statement of operations during the third quarter of fiscal 2016, and a reduction to the purchase accounting consideration; and (4) the fair value of the Visa class C common stock held by Visa Europe as of the Closing. |
Schedule of Purchase Price Allocation | The following table summarizes the preliminary purchase price allocation. Preliminary Purchase Price Allocation (in millions) Current assets (1) $ 4,457 Non-current assets (2) 258 Current liabilities (3) (2,731 ) Non-current liabilities (2) (2,605 ) Tangible assets and liabilities $ (621 ) Intangible assets — customer relationships and reacquired rights (2) 16,137 Goodwill (4) 3,268 Fair value of net assets acquired $ 18,784 (1) Current assets are largely comprised of cash and cash equivalents and settlement receivable. (2) Intangible assets consist of customer relationships and reacquired rights, which have been valued as a single composite intangible asset as they are inextricably linked. These intangibles are considered indefinite-lived assets as the associated customer relationships have historically not experienced significant attrition, and the reacquired rights are based on the Framework Agreement, which has a perpetual term. Non-current assets and liabilities include deferred tax assets and liabilities that result in net deferred tax liabilities of $2.4 billion , which are primarily related to these indefinite-lived intangible assets, and are not expected to be realized in the foreseeable future. (3) Current liabilities assumed mainly include settlement payable, client incentives liabilities and accrued liabilities. (4) The excess of purchase consideration over net assets acquired was recorded as goodwill, which represents the value that is expected from increased scale and synergies as a result of the integration of both businesses. |
Schedule of Acquisition Impact on Net Income | Therefore, the acquisition of Visa Europe reduced Visa Inc. fiscal year 2016 consolidated net income by approximately $872 million , as follows: Impact of Visa Europe acquisition on fiscal 2016 consolidated net income: (in millions) Visa Europe net income included in consolidated net income $ 299 Less approximately $65 million of revenue that would have been recorded by Visa Inc. under the Framework Agreement, net of tax (41 ) Less acquisition-related expense recorded by Visa Inc., net of tax, upon: Effective settlement of the Framework Agreement (1,184 ) Interest expense incurred on $16.0 billion debt, net of interest income earned (243 ) Transaction costs incurred (96 ) Add acquisition-related gains recorded by Visa Inc., net of tax, upon: Revaluation of Visa Europe put option 255 Remeasurement of euro deposits 91 Remeasurement of currency forward contracts 47 Total impact of Visa Europe acquisition on consolidated net income $ (872 ) |
Schedule of Pro Forma Information | Pro Forma Consolidated Results Fiscal 2016 Fiscal 2015 (in millions, except per share data) Total operating revenues $ 16,090 $ 15,425 Net income $ 7,072 $ 5,210 Diluted earnings per share $ 2.93 $ 2.06 |
U.S. and Europe Retrospective31
U.S. and Europe Retrospective Responsibility Plan (Tables) | 12 Months Ended |
Sep. 30, 2016 | |
Retrospective Responsibility Plan [Abstract] | |
Schedule of Restricted Cash and Cash Equivalents | The following table sets forth the changes in the U.S. litigation escrow account: Fiscal 2016 Fiscal 2015 (in millions) Balance at October 1 $ 1,072 $ 1,498 Payments to opt-out merchants (1) (45 ) (426 ) Balance at September 30 $ 1,027 $ 1,072 (1) These payments are associated with the interchange multidistrict litigation. See Note 20—Legal Matters . |
Fair Value Measurements and I32
Fair Value Measurements and Investments (Tables) | 12 Months Ended |
Sep. 30, 2016 | |
Fair Value Measurements and Investments [Abstract] | |
Fair Value, Assets and Liabilities Measured on Recurring Basis | Assets and Liabilities Measured at Fair Value on a Recurring Basis Fair Value Measurements at September 30 Using Inputs Considered as Level 1 Level 2 Level 3 2016 2015 2016 2015 2016 2015 (in millions) Assets Cash equivalents and restricted cash: Money market funds $ 4,537 $ 3,051 U.S. government-sponsored debt securities $ 196 $ 280 Investment securities, trading: Equity securities 71 66 Investment securities, available-for-sale: U.S. government-sponsored debt securities 4,699 2,615 U.S. Treasury securities 2,178 2,656 Equity securities 53 4 Corporate debt securities 249 533 Auction rate securities $ — $ 7 Prepaid and other current assets: Foreign exchange derivative instruments 50 76 Other Assets: Foreign exchange derivative instruments 6 Total $ 6,839 $ 5,777 $ 5,200 $ 3,504 $ — $ 7 Liabilities Accrued liabilities: Visa Europe put option $ — $ 255 Foreign exchange derivative instruments $ 116 $ 13 Other liabilities: Foreign exchange derivative instruments $ 20 Total $ — $ — $ 136 $ 13 $ — $ 255 |
Schedule of Carrying Values and Estimated Fair Values of Debt Instruments | The following table presents the carrying amount and estimated fair value of the Company’s debt in order of maturity: September 30, 2016 Carrying Amount Estimated Fair Value (in millions) 1.20% Senior Notes due December 2017 $ 1,746 $ 1,754 2.20% Senior Notes due December 2020 2,988 3,077 2.80% Senior Notes due December 2022 2,238 2,359 3.15% Senior Notes due December 2025 3,964 4,225 4.15% Senior Notes due December 2035 1,485 1,698 4.30% Senior Notes due December 2045 3,461 4,045 $ 15,882 $ 17,158 |
Available-for-sale Securities | The amortized cost, unrealized gains and losses and fair value of available-for-sale investment securities are as follows: September 30, 2016 September 30, 2015 Amortized Cost Gross Unrealized Fair Value Amortized Cost Gross Unrealized Fair Value Gains Losses Gains Losses (in millions) U.S. government-sponsored debt securities $ 4,693 $ 6 $ — $ 4,699 $ 2,612 $ 3 $ — $ 2,615 U.S. Treasury securities 2,176 3 — 2,179 2,652 4 — 2,656 Equity securities 7 46 — 53 4 — — 4 Corporate debt securities 248 — — 248 533 — — 533 Auction rate securities — — — — 7 — — 7 Total $ 7,124 $ 55 $ — $ 7,179 $ 5,808 $ 7 $ — $ 5,815 Less: current portion of available-for-sale investment securities (3,248 ) (2,431 ) Long-term available-for-sale investment securities $ 3,931 $ 3,384 |
Available for Sale Investments Classified by Contractual Maturity Date | Amortized Cost Fair Value (in millions) September 30, 2016: Due within one year $ 3,193 $ 3,195 Due after 1 year through 5 years 3,925 3,931 Due after 5 years through 10 years — — Due after 10 years — — Total $ 7,118 $ 7,126 |
Investment Income | Investment income is recorded as non-operating income in the Company's consolidated statements of operations and consisted of the following: For the Years Ended September 30, 2016 2015 2014 (in millions) Interest and dividend income on cash and investments $ 75 $ 31 $ 25 Gain on other investments 5 3 8 Investment securities, trading: Unrealized gains (losses), net 3 (6 ) (2 ) Realized gains, net — 2 6 Investment securities, available-for-sale: Realized gains, net 3 21 1 Other-than-temporary impairment on investments (4 ) (5 ) (3 ) Investment income $ 82 $ 46 $ 35 |
Prepaid Expenses and Other As33
Prepaid Expenses and Other Assets (Tables) | 12 Months Ended |
Sep. 30, 2016 | |
Prepaid Expenses and Other Assets [Abstract] | |
Prepaid Expenses and Other Current Assets Disclosure | Prepaid expenses and other current assets consisted of the following: September 30, September 30, (in millions) Prepaid operating expenses and maintenance $ 151 $ 137 Income tax receivable ( See Note 19—Income Taxes) 232 77 Foreign exchange derivative instruments ( See Note 12—Derivative Financial Instruments) 50 76 Other 122 63 Total $ 555 $ 353 |
Schedule of Other Assets, Noncurrent | Other non-current assets consisted of the following: September 30, September 30, (in millions) Non-current income tax receivable ( See Note 19—Income Taxes) $ 731 $ 627 Pension assets ( See Note 10—Pension, Postretirement and Other Benefits) 22 36 Other investments ( See Note 4—Fair Value Measurements and Investments) 46 45 Long-term prepaid operating expenses and other 72 57 Non-current deferred tax assets ( See Note 19—Income Taxes) (1) 22 13 Total $ 893 $ 778 (1) The Company elected to early adopt ASU 2015-17 on a retrospective basis effective October 1, 2015 and all deferred tax assets and liabilities are classified as non-current. Previously, current deferred tax assets had been presented separately and current deferred tax liabilities had been included in accrued liabilities on the consolidated balance sheets. See Note 1—Summary of Significant Accounting Policies and Note 19—Income Taxes . |
Property, Equipment and Techn34
Property, Equipment and Technology, Net (Tables) | 12 Months Ended |
Sep. 30, 2016 | |
Property, Plant and Equipment [Abstract] | |
Property, Plant and Equipment | Property, equipment and technology, net, consisted of the following: September 30, September 30, (in millions) Land $ 74 $ 71 Buildings and building improvements 839 803 Furniture, equipment and leasehold improvements 1,382 1,267 Construction-in-progress 125 120 Technology 2,378 2,022 Total property, equipment and technology 4,798 4,283 Accumulated depreciation and amortization (2,648 ) (2,395 ) Property, equipment and technology, net $ 2,150 $ 1,888 |
Expected amortization expense | At September 30, 2016 , estimated future amortization expense on technology was as follows: Fiscal: 2017 2018 2019 2020 2021 and thereafter Total (in millions) Estimated future amortization expense $ 274 $ 209 $ 161 $ 108 $ 84 $ 836 |
Intangible Assets, Net (Tables)
Intangible Assets, Net (Tables) | 12 Months Ended |
Sep. 30, 2016 | |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |
Schedule of Intangible Assets by Major Class | Indefinite-lived and finite-lived intangible assets consisted of the following: September 30, 2016 September 30, 2015 Gross Accumulated Amortization Net Gross Accumulated Amortization Net (in millions) Finite-lived intangible assets: Customer relationships $ 351 $ (220 ) $ 131 $ 351 $ (196 ) $ 155 Trade names 192 (80 ) 112 192 (67 ) 125 Reseller relationships 95 (70 ) 25 95 (59 ) 36 Other 18 (9 ) 9 53 (17 ) 36 Total finite-lived intangible assets $ 656 $ (379 ) $ 277 $ 691 $ (339 ) $ 352 Indefinite-lived intangible assets: Customer relationships and reacquired rights $ 22,873 $ — $ 22,873 $ 6,925 $ — $ 6,925 Visa trade name 4,084 — 4,084 2,564 — 2,564 Visa Europe franchise right — — — 1,520 — 1,520 Total Indefinite-lived intangible assets $ 26,957 $ — $ 26,957 $ 11,009 $ — $ 11,009 Total intangible assets, net $ 27,613 $ (379 ) $ 27,234 $ 11,700 $ (339 ) $ 11,361 |
Schedule of Estimated Future Amortization Expense | At September 30, 2016 , estimated future amortization expense on finite-lived intangible assets is as follows: Fiscal: 2017 2018 2019 2020 2021 and thereafter Total (in millions) Estimated future amortization expense $ 46 40 40 40 111 $ 277 |
Accrued and Other Liabilities (
Accrued and Other Liabilities (Tables) | 12 Months Ended |
Sep. 30, 2016 | |
Accrued and Other Liabilities [Abstract] | |
Accrued Liabilities Table | Accrued liabilities consisted of the following: September 30, September 30, (in millions) Accrued operating expenses (1) $ 347 $ 257 Visa Europe put option (See Note 2—Acquisition of Visa Europe ) (2) — 255 Accrued interest expenses (3) 145 — Accrued income taxes (See Note 19—Income Taxes ) 153 75 Other (5) 483 262 Total $ 1,128 $ 849 |
Other Noncurrent Liabilities, Table | Other non-current liabilities consisted of the following: September 30, September 30, (in millions) Accrued income taxes (See Note 19—Income Taxes ) (4) $ 911 $ 752 Employee benefits 137 77 Other 114 68 Total $ 1,162 $ 897 (1) Increase includes accrued operating expenses assumed from the Visa Europe acquisition. (2) On June 21, 2016, the Company acquired 100% of the share capital of Visa Europe, effected by the Visa Europe board of directors' exercise of the amended Visa Europe put option. Therefore, the Visa Europe put option was contractually terminated as a result of the transaction. See Note 2—Acquisition of Visa Europe . (3) Interest expenses accrued as at September 30, 2016 is related to the issuance of long-term debt in December 2015. See Note 9—Debt . (4) The increase in non-current accrued income taxes is primarily related to the increase in liabilities for uncertain tax positions. (5) |
Debt (Tables)
Debt (Tables) | 12 Months Ended |
Sep. 30, 2016 | |
Debt Disclosure [Abstract] | |
Schedule of Debt | The Company had outstanding debt as follows: September 30, 2016 Principal Amount Unamortized Discounts and Debt Issuance Costs Carrying Amount Effective Interest Rate (in millions, except percentages) 1.20% Senior Notes due December 2017 (the "2017 Notes") $ 1,750 $ (4 ) $ 1,746 1.37 % 2.20% Senior Notes due December 2020 (the "2020 Notes") 3,000 (12 ) 2,988 2.30 % 2.80% Senior Notes due December 2022 (the "2022 Notes") 2,250 (12 ) 2,238 2.89 % 3.15% Senior Notes due December 2025 (the "2025 Notes") 4,000 (36 ) 3,964 3.26 % 4.15% Senior Notes due December 2035 (the "2035 Notes") 1,500 (15 ) 1,485 4.23 % 4.30% Senior Notes due December 2045 (the "2045 Notes") 3,500 (39 ) 3,461 4.37 % Total long-term debt $ 16,000 $ (118 ) $ 15,882 |
Debt Instrument Redemption | Series Maturity/Par Call Date Spread 2017 Notes December 14, 2017 5 bps 2020 Notes November 14, 2020 10 bps 2022 Notes October 14, 2022 12.5 bps 2025 Notes September 14, 2025 15 bps 2035 Notes June 14, 2035 20 bps 2045 Notes June 14, 2045 20 bps |
Schedule of Future Principal Payments on Outstanding Debt | Future principal payments on the Company's outstanding debt are as follows: Fiscal Year 2017 2018 2019 2020 2021 Thereafter Total (in millions) $ — 1,750 — — 3,000 11,250 $ 16,000 |
Pension, Postretirement and O38
Pension, Postretirement and Other Benefits (Tables) | 12 Months Ended |
Sep. 30, 2016 | |
Defined Benefit Plan Disclosure [Line Items] | |
Schedule of Changes in Projected Benefit Obligations | Change in Benefit Obligation: U.S. Plans Non-U.S. Plans Pension Benefits Other Postretirement Benefits Pension Benefits September 30, September 30, September 30, 2016 2015 2016 2015 2016 (in millions) Benefit obligation—beginning of fiscal year $ 1,005 $ 983 $ 18 $ 20 $ — Visa Europe acquisition — — — — 381 Service cost 13 47 — — 1 Interest cost 40 40 1 1 3 Actuarial loss (gain) 86 40 (2 ) — 86 Benefit payments (64 ) (105 ) (3 ) (3 ) (1 ) Plan amendment (8 ) — — — — Foreign currency exchange rate changes — — — — 4 Benefit obligation—end of fiscal year $ 1,072 $ 1,005 $ 14 $ 18 $ 474 Accumulated benefit obligation $ 1,072 $ 994 NA NA $ 474 Change in Plan Assets: Fair value of plan assets—beginning of fiscal year $ 1,022 $ 1,117 $ — $ — $ — Visa Europe acquisition — — — — 287 Actual return on plan assets 118 (6 ) — — 25 Company contribution 1 16 3 3 102 Benefit payments (64 ) (105 ) (3 ) (3 ) (1 ) Foreign currency exchange rate changes — — — — 2 Fair value of plan assets—end of fiscal year $ 1,077 $ 1,022 $ — $ — $ 415 Funded status at end of fiscal year $ 5 $ 17 $ (14 ) $ (18 ) $ (59 ) Recognized in Consolidated Balance Sheets: Non-current asset $ 22 $ 36 $ — $ — $ — Current liability (9 ) (9 ) (3 ) (3 ) (6 ) Non-current liability (8 ) (10 ) (11 ) (15 ) (53 ) Funded status at end of fiscal year $ 5 $ 17 $ (14 ) $ (18 ) $ (59 ) |
Pension and Other Postretirement Benefits, Recognized in Accumulated Comprehensive Income (Loss) Disclosure | Amounts recognized in accumulated other comprehensive income before tax: U.S. Plans Non-U.S. Plans Pension Benefits Other Postretirement Benefits Pension Benefits September 30, September 30, September 30 2016 2015 2016 2015 2016 (in millions) Net actuarial loss (gain) $ 241 $ 232 $ (5 ) $ (5 ) $ 66 Prior service credit — (9 ) (2 ) (5 ) — Total $ 241 $ 223 $ (7 ) $ (10 ) $ 66 |
Pension And Other Postretirement Benefits, Expected Amortization Of Accumulated Other Comprehensive Income, Disclosure | Amounts from accumulated other comprehensive income to be amortized into net periodic benefit cost in fiscal 2017 : U.S. Plans Non-U.S. Plans Pension Benefits Other Postretirement Benefits Pension Benefits (in millions) Actuarial loss (gain) $ 15 $ (1 ) $ 2 Prior service credit — (2 ) — Total $ 15 $ (3 ) $ 2 |
Plans With Accumulated And Projected Benefit Obligations In Excess Of The Fair Value Of Plan Assets, Disclosure | Benefit obligations in excess of plan assets related to the Company's U.S. non-qualified plan and the non-U.S. pension plans: U.S. Plans Non-U.S. Plans September 30, September 30, 2016 2015 2016 (in millions) Accumulated benefit obligation in excess of plan assets Accumulated benefit obligation—end of year $ (16 ) $ (19 ) $ (474 ) Fair value of plan assets—end of year $ — $ — $ 415 Projected benefit obligation in excess of plan assets Benefit obligation—end of year $ (16 ) $ (19 ) $ 474 Fair value of plan assets—end of year $ — $ — $ 415 |
Schedule of Defined Benefit Plans Disclosures | Net periodic pension and other postretirement plan cost: U.S. Plans Non-U.S. Plans (1) Pension Benefits Other Postretirement Benefits Pension Benefits Fiscal 2016 2015 2014 2016 2015 2014 2016 (in millions) Service cost $ 13 $ 47 $ 46 $ — $ — $ — $ 1 Interest cost 40 40 42 1 1 1 3 Expected return on assets (69 ) (72 ) (68 ) — — — (4 ) Amortization of: Prior service credit (1 ) (7 ) (8 ) (3 ) (3 ) (3 ) — Actuarial loss (gain) 7 1 1 (2 ) (2 ) (1 ) — Net benefit cost $ (10 ) $ 9 $ 13 $ (4 ) $ (4 ) $ (3 ) $ — Curtailment gain (8 ) — (3 ) — — — — Settlement loss 13 7 3 — — — — Total net periodic benefit cost $ (5 ) $ 16 $ 13 $ (4 ) $ (4 ) $ (3 ) $ — (1) Represents Visa Europe's U.K. pension plans' net pension benefit cost recognized from the Closing through September 30, 2016. |
Pension and Other Postretirement Benefits, Changes in Plan Assets and Benefit Obligations Recognized in Other Comprehensive Loss (Income) Disclosure | Other changes in plan assets and benefit obligations recognized in other comprehensive income: U.S. Plans Non-U.S. Plans Pension Benefits Other Postretirement Benefits Pension Benefits 2016 2015 2016 2015 2016 (in millions) Current year actuarial loss (gain) $ 30 $ 119 $ (2 ) $ — $ 66 Amortization of actuarial (loss) gain (20 ) (8 ) 2 2 — Current year prior service credit — — — — — Amortization of prior service credit 9 7 3 3 — Total recognized in other comprehensive income $ 19 $ 118 $ 3 $ 5 $ 66 Total recognized in net periodic benefit cost and other comprehensive income $ 14 $ 134 $ (1 ) $ 1 $ 66 |
Pension and Other Postretirement Benefits, Net Periodic Benefit Costs Weighted Average Assumptions Disclosure | Weighted Average Actuarial Assumptions: U.S. Plans Non-U.S. Plans Fiscal 2016 2015 2014 2016 Discount rate for benefit obligation: (1) Pension 3.62 % 4.33 % 4.27 % 2.40 % Postretirement 1.91 % 2.43 % 2.59 % NA Discount rate for net periodic benefit cost: Pension 4.33 % 4.27 % 4.81 % 3.10 % Postretirement 2.43 % 2.59 % 2.76 % NA Expected long-term rate of return on plan assets (2) 7.00 % 7.00 % 7.00 % 3.92 % Rate of increase in compensation levels for: (3) Benefit obligation NA 4.00 % 4.00 % 3.20 % Net periodic benefit cost NA 4.00 % 4.50 % 3.00 % (1) Represents a single weighted-average discount rate derived based on a cash flow matching analysis, with the projected benefit payments matching spot rates from a yield curve developed from high-quality corporate bonds. (2) Primarily based on the targeted allocation, and evaluated for reasonableness by considering such factors as: (i) actual return on plan assets; (ii) historical rates of return on various asset classes in the portfolio; (iii) projections of returns on various asset classes; and (iv) current and prospective capital market conditions and economic forecasts. (3) This assumption is not applicable for to the U.S. plans in fiscal 2016 due to the amendment of the U.S. qualified defined benefit pension plan in October 2015, which discontinued the employer provided credits effective after December 31, 2015. |
Pension and Other Postretirement Benefits, Employer Contributions and Expected Benefit Payments Disclosure | U.S. Plans Non-U.S. Plans Pension Benefits Other Postretirement Benefits Pension Benefits Actual employer contributions (in millions) 2016 $ 1 $ 3 $ 102 2015 $ 16 $ 3 $ — Expected employer contributions 2017 $ 9 $ 3 $ 6 Expected benefit payments 2017 $ 165 $ 3 $ 4 2018 $ 88 $ 3 $ 4 2019 $ 85 $ 2 $ 5 2020 $ 84 $ 2 $ 5 2021 $ 81 $ 2 $ 5 2022-2026 $ 350 $ 2 $ 27 |
U.S. Plans | |
Defined Benefit Plan Disclosure [Line Items] | |
Fair Value of Net Pension Plan Assets Disclosure | The following table sets forth by level, within the fair value hierarchy, the pension plan’s investments at fair value as of September 30, 2016 and 2015 , including the impact of transactions that were not settled at the end of September: U.S. Plans Fair Value Measurements at September 30, Level 1 Level 2 Level 3 Total 2016 2015 2016 2015 2016 2015 2016 2015 (in millions) Cash equivalents $ 39 $ 11 $ 39 $ 11 Corporate debt securities $ 185 $ 169 185 169 U.S. government-sponsored debt securities 30 66 30 66 U.S. Treasury securities 100 74 100 74 Asset-backed securities $ 51 $ 31 51 31 Equity securities 672 671 672 671 Total $ 811 $ 756 $ 215 $ 235 $ 51 $ 31 $ 1,077 $ 1,022 |
Non-U.S. Plans | |
Defined Benefit Plan Disclosure [Line Items] | |
Fair Value of Net Pension Plan Assets Disclosure | Non-U.S. Plans Fair Value Measurements at September 30, 2016 Level 1 Level 2 Level 3 Total (in millions) Cash equivalents $ 105 $ 105 Corporate debt securities $ 39 39 U.K. Treasury securities 52 52 Asset-backed securities $ 29 29 Equity securities 116 116 Multi-asset securities (1) 74 74 Total $ 273 $ 113 $ 29 $ 415 (1) Multi-asset securities represents pension plan assets that are invested in funds comprised of broad ranges of assets. |
Settlement Guarantee Manageme39
Settlement Guarantee Management (Tables) | 12 Months Ended |
Sep. 30, 2016 | |
Settlement Guarantee Management [Abstract] | |
Schedule of Customer Collateral | The Company maintained collateral as follows: September 30, September 30, (in millions) Cash equivalents $ 1,295 $ 1,023 Pledged securities at market value 170 154 Letters of credit 1,311 1,178 Guarantees 1,418 971 Total $ 4,194 $ 3,326 The balances above included collateral held by Visa Europe as follows: September 30, (in millions) Cash equivalents (1) $ 294 Pledged securities at market value — Letters of credit 144 Guarantees 375 Total $ 813 (1) Cash collateral held by Visa Europe is not included on the Company's consolidated balance sheet as its clients retain beneficial ownership and the cash is only accessible to the Company in the event of default by the client on its settlement obligations. |
Enterprise-wide Disclosures a40
Enterprise-wide Disclosures and Concentration of Business (Tables) | 12 Months Ended |
Sep. 30, 2016 | |
Enterprise-wide Disclosures and Concentration of Business [Abstract] | |
Schedule of long-lived net property, equipment and technology assets by major geographic area | The Company’s long-lived net property, equipment and technology assets are classified by major geographic areas as follows: September 30, September 30, (in millions) United States $ 1,827 $ 1,806 International 323 82 Total $ 2,150 $ 1,888 |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 12 Months Ended |
Sep. 30, 2016 | |
Stockholders' Equity Note [Abstract] | |
Schedule of Common Stock as Converted | The number of shares of each series and class and the number of shares of class A common stock on an as-converted basis at September 30, 2016 , are as follows: (in millions, except conversion rate) Shares Outstanding Conversion Rate Into Class A Common Stock As-converted Class A Common Stock (1) U.K.&I preferred stock 2 13.9520 35 Europe preferred stock 3 13.9520 44 Class A common stock (2) 1,871 — 1,871 Class B common stock 245 1.6483 (3) 405 Class C common stock 17 4.0000 67 Total 2,422 (1) Figures in the table may not recalculate exactly due to rounding. As-converted class A common stock is calculated based on unrounded numbers. (2) Class A common stock shares outstanding reflect repurchases settled on or before September 30, 2016. The Company repurchased an additional 1 million shares at the end of September, which did not settle until October 2016. (3) The class B to class A common stock conversion rate is presented on a rounded basis. Conversion calculations for dividend payments are based on a conversion rate rounded to the tenth decimal. |
Schedule of Share Repurchases in the Open Market | The following table presents share repurchases in the open market during the following fiscal years: (in millions, except per share data) 2016 (1) 2015 Shares repurchased in the open market (2) 91 44 Average repurchase price per share (3) $ 77.05 $ 65.98 Total cost $ 6,987 $ 2,910 (1) Shares repurchased in the open market reflect repurchases settled on or before September 30, 2016. The Company repurchased an additional 1 million shares for $120 million at the end of September, which did not settle until October 2016. (2) All shares repurchased in the open market have been retired and constitute authorized but unissued shares. (3) Figures in the table may not recalculate exactly due to rounding. Average repurchase price per share is calculated based on unrounded numbers. |
Earnings Per Share (Tables)
Earnings Per Share (Tables) | 12 Months Ended |
Sep. 30, 2016 | |
Earnings Per Share [Abstract] | |
Schedule of Earnings Per Share | The following table presents earnings per share for fiscal 2016 . (1) Basic Earnings Per Share Diluted Earnings Per Share (in millions, except per share data) Income Allocation (A) (2) Weighted- Average Shares Outstanding (B) Earnings per Share = (A)/(B) Income Allocation (A) (2) Weighted- Average Shares Outstanding (B) Earnings per Share = (A)/(B) Class A common stock $ 4,738 1,906 $ 2.49 $ 5,991 2,414 (3) $ 2.48 Class B common stock 1,006 245 $ 4.10 $ 1,004 245 $ 4.09 Class C common stock 185 19 $ 9.94 $ 185 19 $ 9.93 Participating securities (4) 62 Not presented Not presented $ 61 Not presented Not presented Net income $ 5,991 The following table presents earnings per share for fiscal 2015 . (1) Basic Earnings Per Share Diluted Earnings Per Share (in millions, except per share data) Income Allocation (A) (2) Weighted- Average Shares Outstanding (B) Earnings per Share = (A)/(B) Income Allocation (A) (2) Weighted- Average Shares Outstanding (B) Earnings per Share = (A)/(B) Class A common stock $ 5,044 1,954 $ 2.58 $ 6,328 2,457 (3) $ 2.58 Class B common stock 1,045 245 $ 4.26 $ 1,042 245 $ 4.25 Class C common stock 224 22 $ 10.33 $ 223 22 $ 10.30 Participating securities (4) 15 Not presented Not presented $ 15 Not presented Not presented Net income $ 6,328 The following table presents earnings per share for fiscal 2014 . (1) Basic Earnings Per Share Diluted Earnings Per Share (in millions, except per share data) Income Allocation (A) (2) Weighted- Average Shares Outstanding (B) Earnings per Share = (A)/(B) Income Allocation (A) (2) Weighted- Average Shares Outstanding (B) Earnings per Share = (A)/(B) Class A common stock $ 4,307 1,993 $ 2.16 $ 5,438 2,523 (3) $ 2.16 Class B common stock 892 245 $ 3.63 $ 890 245 $ 3.62 Class C common stock 222 26 $ 8.65 $ 221 26 $ 8.62 Participating securities (4) 17 Not presented Not presented $ 16 Not presented Not presented Net income $ 5,438 (1) Figures in the table may not recalculate exactly due to rounding. Earnings per share is calculated based on unrounded numbers. The number of shares and per share amounts for the prior periods presented have been retroactively adjusted to reflect the four -for-one stock split effected in the fiscal second quarter of 2015. See Note 14—Stockholders' Equity . (2) Net income attributable to Visa Inc. is allocated based on proportional ownership on an as-converted basis. The weighted-average number of shares of as-converted class B common stock used in the income allocation were 405 million for fiscal 2016 and 2015 and 413 million for fiscal 2014. The weighted-average number of shares of as-converted class C common stock used in the income allocation was 75 million , 87 million and 103 million for fiscal 2016 , 2015 and 2014 , respectively. (3) Weighted-average diluted shares outstanding are calculated on an as-converted basis, and include incremental common stock equivalents, as calculated under the treasury stock method. The computation includes 5 million , 6 million and 7 million common stock equivalents for fiscal 2016 , 2015 and 2014 , respectively, because their effect would have been dilutive. The computation excludes 2 million of common stock equivalents for fiscal 2016 , 2015 and 2014 because their effect would have been anti-dilutive. (4) Participating securities include preferred stock outstanding and unvested share-based payment awards that contain non-forfeitable rights to dividends or dividend equivalents, such as the Company's U.K.&I and Europe preferred stock, restricted stock awards, restricted stock units and earned performance-based shares. U.K.&I and Europe preferred stock were issued as part of the purchase price consideration in connection with the Visa Europe acquisition and are convertible into a number of shares of class A common stock or class A equivalent preferred stock upon certain conditions. Participating securities' income is allocated based on the weighted-average number of shares of as-converted stock. See Note 2—Acquisition of Visa Europe and Note 14—Stockholders' Equity . |
Share-based Compensation (Table
Share-based Compensation (Tables) | 12 Months Ended |
Sep. 30, 2016 | |
Share-based Compensation [Abstract] | |
Share-based Compensation Arrangement by Share-based Payment Award, Fair Value Assumptions, Method Used | During fiscal 2016 , 2015 and 2014 , the fair value of each stock option was estimated on the date of grant using a Black-Scholes option pricing model with the following weighted-average assumptions: 2016 2015 2014 Expected term (in years) (1) 4.35 4.55 4.80 Risk-free rate of return (2) 1.5 % 1.5 % 1.3 % Expected volatility (3) 21.7 % 22.0 % 25.2 % Expected dividend yield (4) 0.7 % 0.8 % 0.8 % Fair value per option granted $ 15.01 $ 12.04 $ 11.03 (1) This assumption is based on the Company's historical option exercises and those of a set of peer companies that management believes is generally comparable to Visa. The Company's data is weighted based on the number of years between the measurement date and Visa's initial public offering as a percentage of the options' contractual term. The relative weighting placed on Visa's data and peer data in fiscal 2016 was approximately 77% and 23% , respectively, 67% and 33% in fiscal 2015, respectively, and 58% and 42% in fiscal 2014, respectively. (2) Based upon the zero coupon U.S. treasury bond rate over the expected term of the awards. (3) Based on the Company’s implied and historical volatility. The expected volatilities ranged from 20% to 23% in fiscal 2016 , 21% to 23% in fiscal 2015, and 22% to 26% in fiscal 2014. (4) Based on the Company’s annual dividend rate on the date of grant. |
Schedule of Share-based Compensation, Options Activity | The following table summarizes the Company’s option activity for fiscal 2016 : Options Weighted- Average Exercise Price Per Share Weighted- Average Remaining Contractual Term (in years) Aggregate Intrinsic Value (1) (in millions) Outstanding at October 1, 2015 9,677,717 $ 28.07 Granted 1,438,048 $ 79.98 Forfeited (463,378 ) $ 21.76 Exercised (1,775,903 ) $ 20.00 Outstanding at September 30, 2016 8,876,484 $ 38.42 5.2 $393 Options exercisable at September 30, 2016 6,204,589 $ 24.87 3.8 $359 Options exercisable and expected to vest at September 30, 2016 (2) 8,582,576 $ 37.35 5.1 $389 (1) Calculated using the closing stock price on the last trading day of fiscal 2016 of $82.70 , less the option exercise price, multiplied by the number of instruments. (2) Applies a forfeiture rate to unvested options outstanding at September 30, 2016 to estimate the options expected to vest in the future. |
Restricted Share Activity Disclosure | The following table summarizes the Company's RSA and RSU activity for fiscal 2016 : Restricted Stock Weighted- Average Grant Date Fair Value Weighted- Average Remaining Contractual Term (in years) Aggregate Intrinsic Value (1) (in millions) Awards Units RSA RSU RSA RSU RSA RSU Outstanding at October 1, 2015 4,064,687 1,442,522 $ 54.09 $ 53.80 Granted — 2,735,115 $ — $ 79.77 Vested (2,061,406 ) (789,180 ) $ 49.06 $ 51.58 Forfeited (236,699 ) (241,503 ) $ 59.34 $ 73.02 Outstanding at September 30, 2016 1,766,582 3,146,954 $ 59.26 $ 75.48 0.8 1.7 $146 $260 (1) Calculated by multiplying the closing stock price on the last trading day of fiscal 2016 of $82.70 by the number of instruments. |
Disclosure of Share-based Compensation Arrangements by Share-based Payment Award | The following table summarizes the maximum number of performance-based shares which could be earned and related activity for fiscal 2016 : Shares Weighted- Average Grant Date Fair Value Weighted- Average Remaining Contractual Term (in years) Aggregate Intrinsic Value (1) (in millions) Outstanding at October 1, 2015 1,263,962 $ 57.61 Granted (2) 604,219 $ 92.71 Vested and earned (645,320 ) $ 54.59 Unearned (123,387 ) $ 54.59 Forfeited (57,462 ) $ 73.07 Outstanding at September 30, 2016 1,042,012 $ 78.24 0.9 $86 (1) Calculated by multiplying the closing stock price on the last trading day of fiscal 2016 of $82.70 by the number of instruments. (2) Represents the maximum number of performance-based shares which could be earned. |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Sep. 30, 2016 | |
Commitments and Contingencies Disclosure [Abstract] | |
Commitments Disclosure | Future minimum payments on leases, and marketing and sponsorship agreements per fiscal year, at September 30, 2016 , are as follows: 2017 2018 2019 2020 2021 Thereafter Total (in millions) Operating leases $ 126 $ 103 $ 82 $ 61 $ 57 $ 190 $ 619 Marketing and sponsorships 126 128 120 110 38 33 555 Total $ 252 $ 231 $ 202 $ 171 $ 95 $ 223 $ 1,174 |
Expected Reduction of Revenue for Volumn and Support Incentive Agreements | The table below sets forth the expected future reduction of revenue per fiscal year for client incentive agreements in effect at September 30, 2016 : (in millions) 2017 2018 2019 2020 2021 Thereafter Total Client incentives $ 4,211 $ 3,752 $ 3,211 $ 2,628 $ 2,245 $ 4,617 $ 20,664 |
Income Taxes (Tables)
Income Taxes (Tables) | 12 Months Ended |
Sep. 30, 2016 | |
Income Tax Disclosure [Abstract] | |
Schedule of U.S. and non-U.S. components of income before income tax expense/(benefit) | The Company’s income before taxes by fiscal year consisted of the following: 2016 2015 2014 (in millions) U.S. $ 5,839 $ 7,214 $ 6,140 Non-U.S. 2,173 1,781 1,584 Total income before taxes $ 8,012 $ 8,995 $ 7,724 |
Comprehensive Income Tax (Expense) Benefit Components Table | Income tax provision by fiscal year consisted of the following: 2016 2015 2014 (in millions) Current: U.S. federal $ 2,250 $ 1,991 $ 2,353 State and local 181 168 237 Non-U.S. 368 300 274 Total current taxes 2,799 2,459 2,864 Deferred: U.S. federal (508 ) 181 (576 ) State and local (63 ) 1 (31 ) Non-U.S. (207 ) 26 29 Total deferred taxes (778 ) 208 (578 ) Total income tax provision $ 2,021 $ 2,667 $ 2,286 |
Components of Deferred Tax Assets and Liabilities | The tax effect of temporary differences that give rise to significant portions of deferred tax assets and liabilities at September 30, 2016 and 2015 , are presented below: 2016 2015 (in millions) Deferred Tax Assets: Accrued compensation and benefits $ 277 $ 141 Comprehensive (income) loss 106 51 Accrued litigation obligation 373 391 Client incentives 266 191 Net operating loss carryforwards 32 50 Federal benefit of state taxes 195 203 Federal benefit of foreign taxes 1,214 — Other 280 185 Valuation allowance (31 ) (40 ) Deferred tax assets 2,712 1,172 Deferred Tax Liabilities: Property, equipment and technology, net (278 ) (315 ) Intangible assets (7,013 ) (3,964 ) Foreign taxes (106 ) (153 ) Other (101 ) — Deferred tax liabilities (7,498 ) (4,432 ) Net deferred tax liabilities $ (4,786 ) $ (3,260 ) |
Reconciliation of the US Statutory Federal Tax Rate | The income tax provision differs from the amount of income tax determined by applying the applicable U.S. federal statutory rate of 35% to pretax income, as a result of the following: For the Years Ended September 30, 2016 2015 2014 Dollars Percent Dollars Percent Dollars Percent (in millions, except percentages) U.S. federal income tax at statutory rate $ 2,804 35 % $ 3,148 35 % $ 2,704 35 % State income taxes, net of federal benefit 135 2 % 194 2 % 129 2 % Non-U.S. tax effect, net of federal benefit (553 ) (7 )% (327 ) (4 )% (278 ) (4 )% Prior years U.S. domestic production activities deduction — — % — — % (191 ) (2 )% Remeasurement of deferred tax liability (88 ) (1 )% — — % — — % Reversal of prior years tax reserves related to the resolution of uncertain tax positions — — % (239 ) (2 )% — — % Revaluation of Visa Europe put option (89 ) (1 )% — — % — — % Other, net (188 ) (3 )% (109 ) (1 )% (78 ) (1 )% Income tax provision $ 2,021 25 % $ 2,667 30 % $ 2,286 30 % |
Unrecognized Tax Benefits Reconciliation, Table | A reconciliation of beginning and ending unrecognized tax benefits by fiscal year is as follows: 2016 2015 (in millions) Beginning balance at October 1 $ 1,051 $ 1,303 Increases of unrecognized tax benefits related to prior years 153 44 Decreases of unrecognized tax benefits related to prior years (180 ) (413 ) Increases of unrecognized tax benefits related to current year 138 120 Reductions related to lapsing statute of limitations (2 ) (3 ) Ending balance at September 30 $ 1,160 $ 1,051 |
Legal Matters (Tables)
Legal Matters (Tables) | 12 Months Ended |
Sep. 30, 2016 | |
Loss Contingencies [Line Items] | |
Schedule of Loss Contingencies by Contingency | The following table summarizes the activity related to accrued litigation. Fiscal 2016 Fiscal 2015 (in millions) Balance at October 1 $ 1,024 $ 1,456 Provision for uncovered legal matters 2 14 Accrual for VE territory covered litigation 2 — Payments on legal matters (47 ) (446 ) Balance at September 30 $ 981 $ 1,024 |
Covered Litigation | |
Loss Contingencies [Line Items] | |
Schedule of Loss Contingencies by Contingency | The following table summarizes the activity related to U.S. covered litigation. Fiscal 2016 Fiscal 2015 (in millions) Balance at October 1 $ 1,023 $ 1,449 Payments on U.S. covered litigation (45 ) (426 ) Balance at September 30 $ 978 $ 1,023 |
Summary of Significant Accoun47
Summary of Significant Accounting Policies - Additional Information (Detail) | Mar. 19, 2015 | Feb. 01, 2015USD ($) | Sep. 30, 2016USD ($) | Jun. 21, 2016 |
Significant Accounting Policies [Line Items] | ||||
Number of Countries in which Entity Operates (more than) | 200 | |||
Number of Reportable Segments | 1 | |||
Impairment of Intangible Assets, Indefinite-lived (Excluding Goodwill) | $ 0 | |||
Goodwill, Impairment Loss | $ 0 | |||
Minimum | ||||
Significant Accounting Policies [Line Items] | ||||
Acquired long-lived intangible assets useful life | 3 years | |||
Maximum | ||||
Significant Accounting Policies [Line Items] | ||||
Acquired long-lived intangible assets useful life | 15 years | |||
Furniture and Fixtures | Minimum | ||||
Significant Accounting Policies [Line Items] | ||||
Estimated useful life | 2 years | |||
Furniture and Fixtures | Maximum | ||||
Significant Accounting Policies [Line Items] | ||||
Estimated useful life | 10 years | |||
Building Improvements | Minimum | ||||
Significant Accounting Policies [Line Items] | ||||
Estimated useful life | 3 years | |||
Building Improvements | Maximum | ||||
Significant Accounting Policies [Line Items] | ||||
Estimated useful life | 40 years | |||
Building | ||||
Significant Accounting Policies [Line Items] | ||||
Estimated useful life | 40 years | |||
Class A common stock | ||||
Significant Accounting Policies [Line Items] | ||||
Common stock split, conversion ratio | 4 | |||
U.S. Pension Plans | ||||
Significant Accounting Policies [Line Items] | ||||
Expected average employee future service period for United States plans (in years) | 9 years | |||
Non-U.S. Pension Plans | ||||
Significant Accounting Policies [Line Items] | ||||
Expected average employee future service period for United States plans (in years) | 12 years | |||
Visa Europe | ||||
Significant Accounting Policies [Line Items] | ||||
Share capital of Visa Europe acquired (percent) | 100.00% |
Visa Europe - Additional Inform
Visa Europe - Additional Information (Detail) $ / shares in Units, € in Billions | Jun. 21, 2016EUR (€)shares | Jun. 21, 2016USD ($)shares | Sep. 30, 2016USD ($)$ / shares | Sep. 30, 2016USD ($)$ / shares | Sep. 30, 2016USD ($)$ / shares | Sep. 30, 2015USD ($)$ / shares | Sep. 30, 2014USD ($) | Jun. 21, 2016USD ($)$ / shares | ||
Class of Stock [Line Items] | ||||||||||
Convertible participating preferred stock issued in Visa Europe acquisition | $ 5,717,000,000 | $ 0 | $ 0 | |||||||
Average price of common stock (USD per share) | $ / shares | $ 77.33 | |||||||||
Initial conversion rate of UK&I and Europe preferred stock into class A common or class A equivalent preferred stock | 13.952 | 13.952 | ||||||||
Revenues | 15,082,000,000 | [1] | 13,880,000,000 | 12,702,000,000 | ||||||
Visa Europe Framework Agreement loss | $ (1,900,000,000) | (1,877,000,000) | 0 | 0 | ||||||
Debt Instrument, Face Amount | $ 16,000,000,000 | $ 16,000,000,000 | 16,000,000,000 | |||||||
Increase (Decrease) Liabilities Related to Investment Contracts, Fair Value Disclosure | 255,000,000 | $ 110,000,000 | ||||||||
Foreign exchange gains related to euros | 145,000,000 | |||||||||
Gains related to currency forward contracts | 74,000,000 | |||||||||
Visa Europe | ||||||||||
Class of Stock [Line Items] | ||||||||||
Share capital of Visa Europe acquired (percent) | 100.00% | 100.00% | ||||||||
Up-front cash consideration | € 12.2 | 13,882,000,000 | ||||||||
Convertible participating preferred stock issued in Visa Europe acquisition | 5.3 | 6,100,000,000 | ||||||||
Contingent consideration | € | 1 | |||||||||
Accrued interest on contingent consideration | € | € 0 | |||||||||
Initial conversion rate of UK&I and Europe preferred stock into class A common or class A equivalent preferred stock | 13.952 | 13.952 | ||||||||
Revenues | $ 554,000,000 | |||||||||
Acquisition related costs | 96,000,000 | |||||||||
Revenue since acquisition | $ 489,000,000 | |||||||||
Visa Europe net income included in consolidated net income | 299,000,000 | |||||||||
Impact of acquisition on consolidated net income | (872,000,000) | |||||||||
Visa Europe Framework Agreement loss | $ (1,856,000,000) | [2] | $ (1,184,000,000) | |||||||
Visa Europe | Class A equivalent preferred stock | ||||||||||
Class of Stock [Line Items] | ||||||||||
Preferred stock, par value | $ / shares | $ 0.0001 | |||||||||
Conversion rate of U.K.&I preferred stock | 100 | |||||||||
Visa Europe | U.K.&I preferred stock | ||||||||||
Class of Stock [Line Items] | ||||||||||
Shares issued at closing (shares) | shares | 2,480,466 | 2,480,466 | ||||||||
Preferred stock, par value | $ / shares | 0.0001 | |||||||||
Visa Europe | Europe preferred stock | ||||||||||
Class of Stock [Line Items] | ||||||||||
Shares issued at closing (shares) | shares | 3,156,823 | 3,156,823 | ||||||||
Preferred stock, par value | $ / shares | $ 0.0001 | |||||||||
Loss Sharing Agreement | Visa Europe | ||||||||||
Class of Stock [Line Items] | ||||||||||
Conversion rate of U.K.&I preferred stock | 0 | 0 | ||||||||
Loss sharing agreement | $ 1,000,000,000 | |||||||||
Preferred Stock | ||||||||||
Class of Stock [Line Items] | ||||||||||
Preferred stock, par value | $ / shares | $ 0.0001 | $ 0.0001 | $ 0.0001 | $ 0.0001 | ||||||
Preferred Stock | Visa Europe | ||||||||||
Class of Stock [Line Items] | ||||||||||
Shares issued at closing (shares) | shares | 79,000,000 | 79,000,000 | ||||||||
Operating Expense | ||||||||||
Class of Stock [Line Items] | ||||||||||
Acquisition related costs | $ 152,000,000 | |||||||||
Professional Fees | ||||||||||
Class of Stock [Line Items] | ||||||||||
Acquisition related costs | 60,000,000 | |||||||||
General and Administrative Expenses | ||||||||||
Class of Stock [Line Items] | ||||||||||
Acquisition related costs | 92,000,000 | |||||||||
Visa Europe | Framework Agreement | ||||||||||
Class of Stock [Line Items] | ||||||||||
Revenues | $ 65,000,000 | 191,000,000 | $ 255,000,000 | $ 226,000,000 | ||||||
United Kingdom | Visa Europe | ||||||||||
Class of Stock [Line Items] | ||||||||||
Tax benefit upon remeasurement of deferred tax liability to reflect tax rate change | $ (88,000,000) | $ (88,000,000) | ||||||||
[1] | The Company did not include Visa Europe's financial results in the Company's consolidated statements of operations from the acquisition date, June 21, 2016, through June 30, 2016 as the impact was immaterial. The Company's consolidated statement of operations for the year ended September 30, 2016 includes Visa Europe's financial results for the three months ended September 30, 2016. See Note 2—Acquisition of Visa Europe. | |||||||||
[2] | the loss upon consummation of the transaction resulting from the effective settlement of the Framework Agreement between Visa and Visa Europe. The Visa Europe Framework Agreement provided Visa Europe with a perpetual, exclusive right to operate the Visa business in the Visa Europe region in exchange for a license fee paid to Visa. Under the terms of the Framework Agreement, the license fee paid by Visa Europe has increased modestly since inception in 2007, while the value of the Visa Europe business has increased at a greater rate. Using an income approach, the Company assessed the contractual terms and conditions of the Framework Agreement as compared to current market conditions and the historical and expected financial performance of Visa Europe. Based on the analysis performed, the Company determined that the terms were not at fair value as determined under U.S. GAAP at the Closing. The present value of the expected differential between payments required by the Framework Agreement and those that would be required if the contract were at fair value under U.S. GAAP was calculated over the Framework Agreement's contractual perpetual term, resulting in a loss of $1.9 billion recognized within operating expense in the Company's consolidated statement of operations during the third quarter of fiscal 2016, and a reduction to the purchase accounting consideration; and |
Visa Europe - Accounting Treatm
Visa Europe - Accounting Treatment (Details) $ in Millions, € in Billions | Jun. 21, 2016EUR (€) | Jun. 21, 2016USD ($) | Sep. 30, 2016USD ($) | Sep. 30, 2015USD ($) | Sep. 30, 2014USD ($) | Jun. 21, 2016USD ($) | |||
Business Acquisition [Line Items] | |||||||||
Less: Visa Europe Framework Agreement loss | $ (1,900) | $ (1,877) | $ 0 | $ 0 | |||||
Preferred stock, as-is converted basis | 5,717 | 0 | 0 | ||||||
Preferred Stock, discount for illiquidity (percent) | 6.00% | 6.00% | |||||||
Right to recover for covered losses | (34) | 0 | $ 0 | $ 25 | |||||
Interest payable on third anniversary of closing (percent) | 1.20% | 1.20% | |||||||
Visa Europe | |||||||||
Business Acquisition [Line Items] | |||||||||
Cash payment | € 12.2 | 13,882 | |||||||
Fair value of preferred stock | [1] | $ 5,692 | |||||||
Total upfront consideration | 19,574 | ||||||||
Fair value of deferred cash consideration | [2] | 1,236 | |||||||
Total consideration before adjustments | 20,810 | ||||||||
Less: Visa Europe Framework Agreement loss | (1,856) | [3] | (1,184) | ||||||
Total accounting purchase consideration | 18,784 | ||||||||
Preferred stock, as-is converted basis | 5.3 | $ 6,100 | |||||||
Contingent consideration | € | 1 | ||||||||
Accrued interest on contingent consideration | € | € 0 | ||||||||
Class C common stock | |||||||||
Business Acquisition [Line Items] | |||||||||
Less: Treasury stock | $ 0 | $ 0 | $ (170) | [4] | |||||
[1] | The fair value of preferred stock was determined based on its as-converted value of $6.1 billion on June 21, 2016, less a 6% discount for illiquidity as these shares are subject to limitations on transferability. The fair value was also adjusted to reflect $25 million of "right to recover for covered losses" related to VE territory covered losses prior to the Closing. See Note 20—Legal Matters. | ||||||||
[2] | This amount reflects the fair value of deferred cash consideration of €1.0 billion, plus 4.0% compound annual interest, payable on the third anniversary of the Closing, discounted at a rate of 1.2%. | ||||||||
[3] | the loss upon consummation of the transaction resulting from the effective settlement of the Framework Agreement between Visa and Visa Europe. The Visa Europe Framework Agreement provided Visa Europe with a perpetual, exclusive right to operate the Visa business in the Visa Europe region in exchange for a license fee paid to Visa. Under the terms of the Framework Agreement, the license fee paid by Visa Europe has increased modestly since inception in 2007, while the value of the Visa Europe business has increased at a greater rate. Using an income approach, the Company assessed the contractual terms and conditions of the Framework Agreement as compared to current market conditions and the historical and expected financial performance of Visa Europe. Based on the analysis performed, the Company determined that the terms were not at fair value as determined under U.S. GAAP at the Closing. The present value of the expected differential between payments required by the Framework Agreement and those that would be required if the contract were at fair value under U.S. GAAP was calculated over the Framework Agreement's contractual perpetual term, resulting in a loss of $1.9 billion recognized within operating expense in the Company's consolidated statement of operations during the third quarter of fiscal 2016, and a reduction to the purchase accounting consideration; and | ||||||||
[4] | the fair value of the Visa class C common stock held by Visa Europe as of the Closing. |
Visa Europe - Purchase Price Al
Visa Europe - Purchase Price Allocation (Details) - USD ($) $ in Millions | Jun. 21, 2016 | Sep. 30, 2016 | Sep. 30, 2015 | ||
Business Combinations [Abstract] | |||||
Current assets | [1] | $ 4,457 | |||
Non-current assets | [2] | 258 | |||
Current liabilities | [3] | (2,731) | |||
Non-current liabilities | [2] | (2,605) | |||
Tangible assets and liabilities | (621) | ||||
Intangible assets - customer relationships and reacquired rights | [2] | 16,137 | |||
Goodwill | 3,268 | [4] | $ 15,066 | $ 11,825 | |
Fair value of net assets acquired | 18,784 | ||||
Net deferred tax liabilities | $ 2,400 | ||||
[1] | Current assets are largely comprised of cash and cash equivalents and settlement receivable. | ||||
[2] | Intangible assets consist of customer relationships and reacquired rights, which have been valued as a single composite intangible asset as they are inextricably linked. These intangibles are considered indefinite-lived assets as the associated customer relationships have historically not experienced significant attrition, and the reacquired rights are based on the Framework Agreement, which has a perpetual term. Non-current assets and liabilities include deferred tax assets and liabilities that result in net deferred tax liabilities of $2.4 billion, which are primarily related to these indefinite-lived intangible assets, and are not expected to be realized in the foreseeable future. | ||||
[3] | Current liabilities assumed mainly include settlement payable, client incentives liabilities and accrued liabilities. | ||||
[4] | The excess of purchase consideration over net assets acquired was recorded as goodwill, which represents the value that is expected from increased scale and synergies as a result of the integration of both businesses. |
Visa Europe - Pro Forma Informa
Visa Europe - Pro Forma Information (Details) - USD ($) $ / shares in Units, $ in Millions | 12 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | |
Business Combinations [Abstract] | ||
Total operating revenues | $ 16,090 | $ 15,425 |
Net income | $ 7,072 | $ 5,210 |
Pro forma diluted earnings per share (in USD per share) | $ 2.93 | $ 2.06 |
Visa Europe - Impact of Acquisi
Visa Europe - Impact of Acquisition on Net Income (Details) - USD ($) $ in Millions | Jun. 21, 2016 | Sep. 30, 2016 | Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2015 | ||
Business Acquisition [Line Items] | ||||||||
Effective settlement of the Framework Agreement | $ (1,900) | $ (1,877) | $ 0 | $ 0 | ||||
Revaluation of Visa Europe put option | (255) | 110 | 0 | |||||
Debt amount | $ 16,000 | 16,000 | $ 16,000 | |||||
Revenues | 15,082 | [1] | 13,880 | 12,702 | ||||
Visa Europe | ||||||||
Business Acquisition [Line Items] | ||||||||
Visa Europe net income included in consolidated net income | 299 | |||||||
Less approximately $65 million of revenue that would have been recorded by Visa Inc. under the Framework Agreement, net of tax | (41) | |||||||
Effective settlement of the Framework Agreement | $ (1,856) | [2] | (1,184) | |||||
Interest expense incurred on $16.0 billion debt, net of interest income earned | (243) | |||||||
Transaction costs incurred | (96) | |||||||
Revaluation of Visa Europe put option | (255) | |||||||
Remeasurement of euro deposits | 91 | |||||||
Remeasurement of currency forward contracts | 47 | |||||||
Total impact of Visa Europe acquisition on consolidated net income | (872) | |||||||
Revenues | 554 | |||||||
Senior Notes | ||||||||
Business Acquisition [Line Items] | ||||||||
Interest expense incurred on $16.0 billion debt, net of interest income earned | (399) | |||||||
Debt amount | 16,000 | 16,000 | ||||||
Framework Agreement | Visa Europe | ||||||||
Business Acquisition [Line Items] | ||||||||
Revenues | $ 65 | $ 191 | $ 255 | $ 226 | ||||
[1] | The Company did not include Visa Europe's financial results in the Company's consolidated statements of operations from the acquisition date, June 21, 2016, through June 30, 2016 as the impact was immaterial. The Company's consolidated statement of operations for the year ended September 30, 2016 includes Visa Europe's financial results for the three months ended September 30, 2016. See Note 2—Acquisition of Visa Europe. | |||||||
[2] | the loss upon consummation of the transaction resulting from the effective settlement of the Framework Agreement between Visa and Visa Europe. The Visa Europe Framework Agreement provided Visa Europe with a perpetual, exclusive right to operate the Visa business in the Visa Europe region in exchange for a license fee paid to Visa. Under the terms of the Framework Agreement, the license fee paid by Visa Europe has increased modestly since inception in 2007, while the value of the Visa Europe business has increased at a greater rate. Using an income approach, the Company assessed the contractual terms and conditions of the Framework Agreement as compared to current market conditions and the historical and expected financial performance of Visa Europe. Based on the analysis performed, the Company determined that the terms were not at fair value as determined under U.S. GAAP at the Closing. The present value of the expected differential between payments required by the Framework Agreement and those that would be required if the contract were at fair value under U.S. GAAP was calculated over the Framework Agreement's contractual perpetual term, resulting in a loss of $1.9 billion recognized within operating expense in the Company's consolidated statement of operations during the third quarter of fiscal 2016, and a reduction to the purchase accounting consideration; and |
Changes in the Escrow Account (
Changes in the Escrow Account (Detail) $ / shares in Units, shares in Millions, $ in Millions | 12 Months Ended | ||||
Sep. 30, 2016USD ($)$ / sharesshares | Sep. 30, 2015USD ($)shares | Sep. 30, 2014USD ($) | Jun. 21, 2016USD ($) | ||
Restricted Cash and Cash Equivalents Items [Line Items] | |||||
Preferred Stock Available to Recover Covered Losses, Value, As-converted | $ 6,504 | ||||
Preferred Stock Available to Recover Covered Losses, Value | 5,717 | ||||
Escrow Account [Roll Forward] | |||||
Litigation Escrow Account Balance, Beginning of Period | 1,072 | $ 1,498 | |||
Litigation Escrow Account Balance, End of Period | 1,027 | 1,072 | $ 1,498 | ||
VE Covered Loss, Maximum Amount of Loss to Allow Adjustment of Conversion Rate during Six-month Period | 20 | ||||
Right to recover for covered losses (Note 3) | (34) | 0 | $ 0 | $ 25 | |
Initial conversion rate of UK&I and Europe preferred stock into class A common or class A equivalent preferred stock | 13.952 | ||||
Preferred Stock Available to Recover Covered Losses, Value, As-converted, Net | 6,470 | ||||
Preferred Stock Available to Recover Covered Losses, Value, Net | $ 5,683 | ||||
Closing Stock Price | $ / shares | $ 82.7 | ||||
Opt-out Merchants | |||||
Escrow Account [Roll Forward] | |||||
Payments to Settlement Funds | [1] | $ (45) | $ (426) | ||
MasterCard [Member] | |||||
Escrow Account [Roll Forward] | |||||
Omnibus Loss Sharing Agreement Percentage | 33.3333% | ||||
Visa | |||||
Escrow Account [Roll Forward] | |||||
Omnibus Loss Sharing Agreement Percentage | 66.6667% | ||||
Class A common stock | |||||
Escrow Account [Roll Forward] | |||||
Closing Stock Price | $ / shares | $ 82.70 | ||||
Series B Preferred Stock | |||||
Restricted Cash and Cash Equivalents Items [Line Items] | |||||
Preferred Stock Available to Recover Covered Losses, Value, As-converted | $ 2,862 | ||||
Preferred Stock Available to Recover Covered Losses, Value | $ 2,516 | ||||
Escrow Account [Roll Forward] | |||||
Preferred stock, shares outstanding | shares | 2 | 0 | |||
Series C Preferred Stock | |||||
Restricted Cash and Cash Equivalents Items [Line Items] | |||||
Preferred Stock Available to Recover Covered Losses, Value, As-converted | $ 3,642 | ||||
Preferred Stock Available to Recover Covered Losses, Value | $ 3,201 | ||||
Escrow Account [Roll Forward] | |||||
Preferred stock, shares outstanding | shares | 3 | 0 | |||
[1] | 1)These payments are associated with the interchange multidistrict litigation. See Note 20—Legal Matters. |
Fair Value Measurements and I54
Fair Value Measurements and Investments - Additional Information (Detail) - USD ($) $ in Millions | Feb. 01, 2015 | Sep. 30, 2016 | Jun. 21, 2016 | Dec. 31, 2015 | Sep. 30, 2015 | |
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Fair Value, Assets, Level 1 to Level 2 Transfers, Amount | $ 0 | |||||
Put option, fair value | [1] | 0 | $ 255 | |||
Non-marketable equity investments | 46 | 45 | ||||
Goodwill and intangible asset impairment | $ 0 | |||||
Principal amount | 16,000 | $ 16,000 | ||||
Trading assets, mutual fund investments related to various employee compensation plans | 71 | 66 | ||||
Visa Europe | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Share capital of Visa Europe acquired (percent) | 100.00% | |||||
Fair Value, Measurements, Recurring | Level 3 | Visa Europe put option | ||||||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||||||
Put option, fair value | $ 0 | $ 255 | ||||
[1] | On June 21, 2016, the Company acquired 100% of the share capital of Visa Europe, effected by the Visa Europe board of directors' exercise of the amended Visa Europe put option. Therefore, the Visa Europe put option was contractually terminated as a result of the transaction. See Note 2—Acquisition of Visa Europe. |
Assets and Liabilities Measured
Assets and Liabilities Measured at Fair Value on a Recurring Basis (Detail) - USD ($) $ in Millions | Sep. 30, 2016 | Sep. 30, 2015 | |
Investment securities | |||
Trading | $ 71 | $ 66 | |
Available-for-sale securities | 7,179 | 5,815 | |
Accrued liabilities | |||
Visa Europe put option | [1] | 0 | 255 |
Fair Value, Measurements, Recurring | Level 1 | |||
Investment securities | |||
Fair value, total assets | 6,839 | 5,777 | |
Accrued liabilities | |||
Fair value, total liabilities | 0 | 0 | |
Fair Value, Measurements, Recurring | Level 1 | Money market funds | |||
Cash equivalents and restricted cash | |||
Cash equivalents and restricted cash | 4,537 | 3,051 | |
Fair Value, Measurements, Recurring | Level 1 | Equity securities | |||
Investment securities | |||
Trading | 71 | 66 | |
Available-for-sale securities | 53 | 4 | |
Fair Value, Measurements, Recurring | Level 1 | U.S. treasury securities | |||
Investment securities | |||
Available-for-sale securities | 2,178 | 2,656 | |
Fair Value, Measurements, Recurring | Level 2 | |||
Investment securities | |||
Fair value, total assets | 5,200 | 3,504 | |
Accrued liabilities | |||
Fair value, total liabilities | 136 | 13 | |
Fair Value, Measurements, Recurring | Level 2 | U.S. government-sponsored agency debt securities | |||
Cash equivalents and restricted cash | |||
Cash equivalents and restricted cash | 196 | 280 | |
Investment securities | |||
Available-for-sale securities | 4,699 | 2,615 | |
Fair Value, Measurements, Recurring | Level 2 | Corporate debt securities | |||
Investment securities | |||
Available-for-sale securities | 249 | 533 | |
Fair Value, Measurements, Recurring | Level 3 | |||
Investment securities | |||
Fair value, total assets | 0 | 7 | |
Accrued liabilities | |||
Fair value, total liabilities | 0 | 255 | |
Fair Value, Measurements, Recurring | Level 3 | Visa Europe put option | |||
Accrued liabilities | |||
Visa Europe put option | 0 | 255 | |
Fair Value, Measurements, Recurring | Level 3 | Auction Rate Securities | |||
Investment securities | |||
Available-for-sale securities | 0 | 7 | |
Prepaid Expenses and Other Current Assets [Member] | Fair Value, Measurements, Recurring | Level 2 | Foreign exchange derivative instruments | |||
Investment securities | |||
Foreign exchange derivative instruments | 50 | 76 | |
Other Assets | Fair Value, Measurements, Recurring | Level 2 | Foreign exchange derivative instruments | |||
Investment securities | |||
Foreign exchange derivative instruments | 6 | ||
Accrued Liabilities | Fair Value, Measurements, Recurring | Level 2 | Foreign exchange derivative instruments | |||
Accrued liabilities | |||
Foreign exchange derivative instruments | 116 | $ 13 | |
Other Liabilities | Fair Value, Measurements, Recurring | Level 2 | Foreign exchange derivative instruments | |||
Accrued liabilities | |||
Foreign exchange derivative instruments | $ 20 | ||
[1] | On June 21, 2016, the Company acquired 100% of the share capital of Visa Europe, effected by the Visa Europe board of directors' exercise of the amended Visa Europe put option. Therefore, the Visa Europe put option was contractually terminated as a result of the transaction. See Note 2—Acquisition of Visa Europe. |
Fair Value Measurements and I56
Fair Value Measurements and Investments Carrying amount and estimated fair value of debt (Details) - USD ($) $ in Millions | Sep. 30, 2016 | Dec. 31, 2015 | Sep. 30, 2015 |
Debt Instrument [Line Items] | |||
Carrying Amount | $ 15,882 | $ 0 | |
Senior Notes | |||
Debt Instrument [Line Items] | |||
Carrying Amount | 15,882 | $ 15,900 | |
Estimated Fair Value | 17,158 | ||
2017 Notes | Senior Notes | |||
Debt Instrument [Line Items] | |||
Carrying Amount | 1,746 | ||
Estimated Fair Value | 1,754 | ||
2020 Notes | Senior Notes | |||
Debt Instrument [Line Items] | |||
Carrying Amount | 2,988 | ||
Estimated Fair Value | 3,077 | ||
2022 Notes | Senior Notes | |||
Debt Instrument [Line Items] | |||
Carrying Amount | 2,238 | ||
Estimated Fair Value | 2,359 | ||
2025 Notes | Senior Notes | |||
Debt Instrument [Line Items] | |||
Carrying Amount | 3,964 | ||
Estimated Fair Value | 4,225 | ||
2035 Notes | Senior Notes | |||
Debt Instrument [Line Items] | |||
Carrying Amount | 1,485 | ||
Estimated Fair Value | 1,698 | ||
2045 Notes | Senior Notes | |||
Debt Instrument [Line Items] | |||
Carrying Amount | 3,461 | ||
Estimated Fair Value | $ 4,045 |
Amortized Cost, Unrealized Gain
Amortized Cost, Unrealized Gains and Losses, and Fair Value of Available-for-sale Securities (Detail) - USD ($) $ in Millions | Sep. 30, 2016 | Sep. 30, 2015 |
Schedule of Available-for-sale Securities [Line Items] | ||
Available-For-Sale Amortized Cost | $ 7,124 | $ 5,808 |
Available-for-sale, Gross Unrealized Gains | 55 | 7 |
Available-for-sale, Gross Unrealized Losses | 0 | 0 |
Available-for-sale securities | 7,179 | 5,815 |
Less: current portion of available-for-sale investment securities | (3,248) | (2,431) |
Long-term available-for-sale investment securities | 3,931 | 3,384 |
US Government-sponsored agency debt securities | Debt and Equity Securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available-For-Sale Amortized Cost | 4,693 | 2,612 |
Available-for-sale, Gross Unrealized Gains | 6 | 3 |
Available-for-sale securities | 4,699 | 2,615 |
U.S. treasury securities | Debt and Equity Securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available-For-Sale Amortized Cost | 2,176 | 2,652 |
Available-for-sale, Gross Unrealized Gains | 3 | 4 |
Available-for-sale securities | 2,179 | 2,656 |
Equity securities | Debt and Equity Securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available-For-Sale Amortized Cost | 7 | 4 |
Available-for-sale, Gross Unrealized Gains | 46 | |
Available-for-sale securities | 53 | 4 |
Corporate debt securities | Debt and Equity Securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available-For-Sale Amortized Cost | 248 | 533 |
Available-for-sale securities | $ 248 | 533 |
Auction rate securities | Debt and Equity Securities | ||
Schedule of Available-for-sale Securities [Line Items] | ||
Available-For-Sale Amortized Cost | 7 | |
Available-for-sale securities | $ 7 |
Contractual Maturity of Availab
Contractual Maturity of Available-for-sale Debt Securities (Detail) $ in Millions | Sep. 30, 2016USD ($) |
Amortized Cost | |
Due within one year | $ 3,193 |
Due after 1 year through 5 years | 3,925 |
Due after 5 years through 10 years | 0 |
Due after 10 years | 0 |
Total | 7,118 |
Fair Value | |
Due within one year | 3,195 |
Due after 1 year through 5 years | 3,931 |
Due after 5 years through 10 years | 0 |
Due after 10 years | 0 |
Total | $ 7,126 |
Investment Income, Net (Detail)
Investment Income, Net (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2014 | |
Fair Value Measurements and Investments [Abstract] | |||
Interest and dividend income on cash and investments | $ 75 | $ 31 | $ 25 |
Gain on other investments | 5 | 3 | 8 |
Investment securities, trading: | |||
Unrealized gains (losses), net | 3 | (6) | (2) |
Realized gains (losses), net | 2 | 6 | |
Investment securities, available-for-sale: | |||
Realized gains, net | 3 | 21 | 1 |
Other-than-temporary impairment on investments | (4) | (5) | (3) |
Investment income | $ 82 | $ 46 | $ 35 |
Prepaid Expenses and Other Curr
Prepaid Expenses and Other Current Assets (Detail) - USD ($) $ in Millions | Sep. 30, 2016 | Sep. 30, 2015 |
Prepaid Expenses and Other Assets [Abstract] | ||
Prepaid operating expenses and maintenance | $ 151 | $ 137 |
Income tax receivable (See Note 19—Income Taxes) | 232 | 77 |
Foreign exchange derivative instruments (See Note 12—Derivative Financial Instruments) | 50 | 76 |
Other | 122 | 63 |
Total | $ 555 | $ 353 |
Other Non-Current Assets (Detai
Other Non-Current Assets (Detail) - USD ($) $ in Millions | Sep. 30, 2016 | Sep. 30, 2015 |
Prepaid Expenses and Other Assets [Line Items] | ||
Non-current income tax receivable (See Note 19—Income Taxes) | $ 627 | |
Pension assets (See Note 10—Pension, Postretirement and Other Benefits) | $ 22 | 36 |
Other investments (See Note 4—Fair Value Measurements and Investments) | 46 | 45 |
Long-term prepaid operating expenses and other | 72 | 57 |
Non-current deferred tax assets (See Note 19—Income Taxes)(1) | 22 | 13 |
Total | 893 | 778 |
Other Assets | ||
Prepaid Expenses and Other Assets [Line Items] | ||
Non-current income tax receivable (See Note 19—Income Taxes) | $ 731 | $ 627 |
Property, Equipment and Techn62
Property, Equipment and Technology, Net (Detail) - USD ($) $ in Millions | Sep. 30, 2016 | Sep. 30, 2015 |
Property, Plant and Equipment [Line Items] | ||
Total property, equipment and technology | $ 4,798 | $ 4,283 |
Accumulated depreciation and amortization | (2,648) | (2,395) |
Property, equipment and technology, net | 2,150 | 1,888 |
Land | ||
Property, Plant and Equipment [Line Items] | ||
Total property, equipment and technology | 74 | 71 |
Buildings and building improvements | ||
Property, Plant and Equipment [Line Items] | ||
Total property, equipment and technology | 839 | 803 |
Furniture, equipment and leasehold improvements | ||
Property, Plant and Equipment [Line Items] | ||
Total property, equipment and technology | 1,382 | 1,267 |
Construction-in-progress | ||
Property, Plant and Equipment [Line Items] | ||
Total property, equipment and technology | 125 | 120 |
Technology | ||
Property, Plant and Equipment [Line Items] | ||
Total property, equipment and technology | $ 2,378 | $ 2,022 |
Property, Equipment and Techn63
Property, Equipment and Technology, Net - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | |||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2014 | ||
Finite-Lived Intangible Assets [Line Items] | ||||
Technology, accumulated amortization | $ 1,500 | $ 1,400 | ||
Depreciation and amortization | 502 | [1] | 494 | $ 435 |
Depreciation and amortization, amortization expense on technology | 50 | 63 | 66 | |
Property, Equipment and Technology | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Depreciation and amortization | 452 | 431 | 369 | |
Technology and Software | ||||
Finite-Lived Intangible Assets [Line Items] | ||||
Depreciation and amortization, amortization expense on technology | $ 259 | $ 251 | $ 198 | |
[1] | The Company did not include Visa Europe's financial results in the Company's consolidated statements of operations from the acquisition date, June 21, 2016, through June 30, 2016 as the impact was immaterial. The Company's consolidated statement of operations for the year ended September 30, 2016 includes Visa Europe's financial results for the three months ended September 30, 2016. See Note 2—Acquisition of Visa Europe. |
Estimated Future Amortization E
Estimated Future Amortization Expense on Technology Placed in Service (Detail) $ in Millions | Sep. 30, 2016USD ($) |
Finite-Lived Intangible Assets [Line Items] | |
2,017 | $ 46 |
2,018 | 40 |
2,019 | 40 |
2,020 | 40 |
2021 and thereafter | 111 |
Total | 277 |
Technology and Software | |
Finite-Lived Intangible Assets [Line Items] | |
2,017 | 274 |
2,018 | 209 |
2,019 | 161 |
2,020 | 108 |
2021 and thereafter | 84 |
Total | $ 836 |
Intangible Assets, Net - Additi
Intangible Assets, Net - Additional Information (Detail) - USD ($) $ in Millions | Jun. 21, 2016 | Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2014 | ||
Intangible Assets, Net (Excluding Goodwill) [Abstract] | ||||||
Amortization expense related to finite-lived intangible assets | $ 50 | $ 63 | $ 66 | |||
Impairment of indefinite-lived or finite-lived intangible assets | 0 | 0 | $ 0 | |||
Acquired Indefinite-lived Intangible Assets [Line Items] | ||||||
Goodwill | $ 3,268 | [1] | 15,066 | 11,825 | ||
Indefinite-lived Intangible Assets Acquired | [2] | 16,137 | ||||
Indefinite-lived Intangible Assets | 26,957 | 11,009 | ||||
Goodwill, Foreign Currency Translation Gain (Loss) | 39 | |||||
Franchise Rights [Member] | ||||||
Acquired Indefinite-lived Intangible Assets [Line Items] | ||||||
Indefinite-lived Intangible Assets | 1,500 | $ 0 | $ 1,520 | |||
Visa Europe | ||||||
Acquired Indefinite-lived Intangible Assets [Line Items] | ||||||
Total purchase consideration | $ 18,784 | |||||
[1] | The excess of purchase consideration over net assets acquired was recorded as goodwill, which represents the value that is expected from increased scale and synergies as a result of the integration of both businesses. | |||||
[2] | Intangible assets consist of customer relationships and reacquired rights, which have been valued as a single composite intangible asset as they are inextricably linked. These intangibles are considered indefinite-lived assets as the associated customer relationships have historically not experienced significant attrition, and the reacquired rights are based on the Framework Agreement, which has a perpetual term. Non-current assets and liabilities include deferred tax assets and liabilities that result in net deferred tax liabilities of $2.4 billion, which are primarily related to these indefinite-lived intangible assets, and are not expected to be realized in the foreseeable future. |
Fair Value of Intangible Assets
Fair Value of Intangible Assets and Related Accumulated Amortization Expense (Detail) - USD ($) $ in Millions | Sep. 30, 2016 | Jun. 21, 2016 | Sep. 30, 2015 |
Finite-Lived Intangible Assets [Line Items] | |||
Gross | $ 656 | $ 691 | |
Accumulated Amortization | (379) | (339) | |
Finite-Lived Intangible Assets, Net | 277 | 352 | |
Indefinite-lived Intangible Assets | 26,957 | 11,009 | |
Gross | 27,613 | 11,700 | |
Net | 27,234 | 11,361 | |
Customer relationships and reacquired rights | |||
Finite-Lived Intangible Assets [Line Items] | |||
Indefinite-lived Intangible Assets | 22,873 | 6,925 | |
Visa trade name | |||
Finite-Lived Intangible Assets [Line Items] | |||
Indefinite-lived Intangible Assets | 4,084 | 2,564 | |
Visa Europe franchise right | |||
Finite-Lived Intangible Assets [Line Items] | |||
Indefinite-lived Intangible Assets | 0 | $ 1,500 | 1,520 |
Customer relationships | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross | 351 | 351 | |
Accumulated Amortization | (220) | (196) | |
Finite-Lived Intangible Assets, Net | 131 | 155 | |
Tradenames | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross | 192 | 192 | |
Accumulated Amortization | (80) | (67) | |
Finite-Lived Intangible Assets, Net | 112 | 125 | |
Reseller relationships | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross | 95 | 95 | |
Accumulated Amortization | (70) | (59) | |
Finite-Lived Intangible Assets, Net | 25 | 36 | |
Other | |||
Finite-Lived Intangible Assets [Line Items] | |||
Gross | 18 | 53 | |
Accumulated Amortization | (9) | (17) | |
Finite-Lived Intangible Assets, Net | $ 9 | $ 36 |
Estimated Future Amortization67
Estimated Future Amortization Expense on Finite-Lived Intangible Assets (Detail) $ in Millions | Sep. 30, 2016USD ($) |
Intangible Assets, Net (Excluding Goodwill) [Abstract] | |
2,017 | $ 46 |
2,018 | 40 |
2,019 | 40 |
2,020 | 40 |
2021 and thereafter | 111 |
Total | $ 277 |
Accrued Liabilities (Detail)
Accrued Liabilities (Detail) - USD ($) $ in Millions | 12 Months Ended | ||||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2014 | Jun. 21, 2016 | ||
Accrued Liabilities [Line Items] | |||||
Accrued operating expenses | [1] | $ 347 | $ 257 | ||
Visa Europe put option-(See Note 2-Visa Europe) | [2] | 0 | 255 | ||
Interest Payable | [3] | 145 | 0 | ||
Accrued income taxes-(See Note 19-Income Taxes) | 153 | 75 | |||
Other | [4] | 483 | 262 | ||
Total | 1,128 | 849 | |||
Fair value adjustment for the Visa Europe put option | 255 | $ (110) | $ 0 | ||
Visa Europe | |||||
Accrued Liabilities [Line Items] | |||||
Fair value adjustment for the Visa Europe put option | $ 255 | ||||
Share capital of Visa Europe acquired (percent) | 100.00% | ||||
[1] | Increase includes accrued operating expenses assumed from the Visa Europe acquisition | ||||
[2] | On June 21, 2016, the Company acquired 100% of the share capital of Visa Europe, effected by the Visa Europe board of directors' exercise of the amended Visa Europe put option. Therefore, the Visa Europe put option was contractually terminated as a result of the transaction. See Note 2—Acquisition of Visa Europe. | ||||
[3] | Interest expenses accrued as at September 30, 2016 is related to the issuance of long-term debt in December 2015. See Note 9—Debt. | ||||
[4] | Current year balance includes amounts assumed from the Visa Europe acquisition related to uncertainties around foreign non-income tax obligations. Prior year current deferred tax liabilities have been retroactively reclassed to non-current deferred tax liabilities on the consolidated balance sheets upon adoption of FASB issued ASU 2015-17. See Note 1—Summary of Significant Accounting Policies and Note 19—Income Taxes. |
Other Long-term Liabilities (De
Other Long-term Liabilities (Detail) - USD ($) $ in Millions | Sep. 30, 2016 | Sep. 30, 2015 | |
Accrued and Other Liabilities [Abstract] | |||
Accrued income taxes-(See Note 19-Income Taxes) | [1] | $ 911 | $ 752 |
Employee benefits | 137 | 77 | |
Other | 114 | 68 | |
Total | $ 1,162 | $ 897 | |
[1] | The increase in non-current accrued income taxes is primarily related to the increase in liabilities for uncertain tax positions. |
Debt - Senior Notes (Details)
Debt - Senior Notes (Details) - USD ($) $ in Millions | Sep. 30, 2016 | Dec. 31, 2015 | Sep. 30, 2015 |
Debt Instrument [Line Items] | |||
Principal amount | $ 16,000 | $ 16,000 | |
Carrying amount | 15,882 | $ 0 | |
Senior Notes | |||
Debt Instrument [Line Items] | |||
Principal amount | 16,000 | ||
Unamortized discounts and debt issuance costs | (118) | ||
Carrying amount | 15,882 | $ 15,900 | |
Senior Notes | 2017 Notes | |||
Debt Instrument [Line Items] | |||
Principal amount | 1,750 | ||
Unamortized discounts and debt issuance costs | (4) | ||
Carrying amount | $ 1,746 | ||
Effective interest rate (percent) | 1.37% | ||
Stated interest rate (percent) | 1.20% | ||
Senior Notes | 2020 Notes | |||
Debt Instrument [Line Items] | |||
Principal amount | $ 3,000 | ||
Unamortized discounts and debt issuance costs | (12) | ||
Carrying amount | $ 2,988 | ||
Effective interest rate (percent) | 2.30% | ||
Stated interest rate (percent) | 2.20% | ||
Senior Notes | 2022 Notes | |||
Debt Instrument [Line Items] | |||
Principal amount | $ 2,250 | ||
Unamortized discounts and debt issuance costs | (12) | ||
Carrying amount | $ 2,238 | ||
Effective interest rate (percent) | 2.89% | ||
Stated interest rate (percent) | 2.80% | ||
Senior Notes | 2025 Notes | |||
Debt Instrument [Line Items] | |||
Principal amount | $ 4,000 | ||
Unamortized discounts and debt issuance costs | (36) | ||
Carrying amount | $ 3,964 | ||
Effective interest rate (percent) | 3.26% | ||
Stated interest rate (percent) | 3.15% | ||
Senior Notes | 2035 Notes | |||
Debt Instrument [Line Items] | |||
Principal amount | $ 1,500 | ||
Unamortized discounts and debt issuance costs | (15) | ||
Carrying amount | $ 1,485 | ||
Effective interest rate (percent) | 4.23% | ||
Stated interest rate (percent) | 4.15% | ||
Senior Notes | 2045 Notes | |||
Debt Instrument [Line Items] | |||
Principal amount | $ 3,500 | ||
Unamortized discounts and debt issuance costs | (39) | ||
Carrying amount | $ 3,461 | ||
Effective interest rate (percent) | 4.37% | ||
Stated interest rate (percent) | 4.30% |
Debt - Additional Information (
Debt - Additional Information (Detail) | Jan. 27, 2016USD ($) | Dec. 31, 2015USD ($) | Sep. 30, 2016USD ($) | Sep. 30, 2015USD ($) |
Debt Instrument [Line Items] | ||||
Principal amount | $ 16,000,000,000 | $ 16,000,000,000 | ||
Net aggregate proceeds | 15,882,000,000 | $ 0 | ||
Revolving Credit Facility | ||||
Debt Instrument [Line Items] | ||||
Credit Facility Maximum Borrowing Capacity | $ 4,000,000,000 | $ 3,000,000,000 | ||
Consolidated indebtedness to consolidated EBITDA ratio (not greater than) | 3.75 | |||
Credit Facility Amount Outanding | 0 | |||
Commercial Paper | ||||
Debt Instrument [Line Items] | ||||
Commercial Paper Program, Amount Available | $ 3,000,000,000 | |||
Commercial Paper Program, Maturity Period | P397D | |||
Commercial Paper Program, Amount Outstanding | $ 0 | |||
Senior Notes | ||||
Debt Instrument [Line Items] | ||||
Principal amount | 16,000,000,000 | |||
Interest expense | 399,000,000 | |||
Net aggregate proceeds | $ 15,900,000,000 | $ 15,882,000,000 | ||
Senior Notes | Minimum | ||||
Debt Instrument [Line Items] | ||||
Maturity period for senior notes | 2 years | |||
Stated interest rate (percent) | 1.20% | |||
Senior Notes | Maximum | ||||
Debt Instrument [Line Items] | ||||
Maturity period for senior notes | 30 years | |||
Stated interest rate (percent) | 4.30% | |||
If Redeemed Prior to Maturity Date or Par Call Date, As Applicable | Senior Notes | ||||
Debt Instrument [Line Items] | ||||
Redemption price, as percentage of principal amount (percent) | 100.00% | |||
If Redeemed on or after Par Call Date, except for 2017 Notes | Senior Notes | ||||
Debt Instrument [Line Items] | ||||
Redemption price, as percentage of principal amount (percent) | 100.00% |
Debt - Debt Redemption (Details
Debt - Debt Redemption (Details) - Senior Notes | 12 Months Ended |
Sep. 30, 2016 | |
2017 Notes | |
Debt Instrument [Line Items] | |
Redemption price, additional basis spread (percent) | 0.05% |
2020 Notes | |
Debt Instrument [Line Items] | |
Redemption price, additional basis spread (percent) | 0.10% |
2022 Notes | |
Debt Instrument [Line Items] | |
Redemption price, additional basis spread (percent) | 0.125% |
2025 Notes | |
Debt Instrument [Line Items] | |
Redemption price, additional basis spread (percent) | 0.15% |
2035 Notes | |
Debt Instrument [Line Items] | |
Redemption price, additional basis spread (percent) | 0.20% |
2045 Notes | |
Debt Instrument [Line Items] | |
Redemption price, additional basis spread (percent) | 0.20% |
Debt - Debt Maturities (Details
Debt - Debt Maturities (Details) - USD ($) $ in Millions | Sep. 30, 2016 | Dec. 31, 2015 |
Debt Disclosure [Abstract] | ||
2,017 | $ 0 | |
2,018 | 1,750 | |
2,019 | 0 | |
2,020 | 0 | |
2,021 | 3,000 | |
Thereafter | 11,250 | |
Total | $ 16,000 | $ 16,000 |
Pension, Postretirement and O74
Pension, Postretirement and Other Benefits - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2014 | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Postretirement benefit plan, age when benefits terminate | 65 years | ||
Assumed annual rate of future increases in health benefits for the other postretirement benefits plan for fiscal 2011 | 8.00% | ||
Assumed annual rate of future decreases in health benefits for the other postretirement benefits plan by 2017 | 5.00% | ||
Schedule of Effect of One-Percentage-Point Change in Assumed Health Care Cost Trend Rates [Table Text Block] | 0.01 | ||
Increasing or decreasing the healthcare cost trend by one per cent would increase decrease the postretirement accumulated plan benefit obligation by less than | $ 1 | ||
Defined contribution plan, personnel costs | $ 55 | $ 49 | $ 46 |
U.S. Plans | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Cash balance formula contributions, rate of eligible compensation | 6.00% | ||
Curtailment gain recognized | $ 8 | ||
Company contribution | $ 1 | 16 | |
U.S. Plans | Equity securities | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Target allocation for plan assets, equity securities, minimum | 50.00% | ||
Target allocation for plan assets, equity securities, maximum | 80.00% | ||
Plan asset allocation, equity securities | 62.00% | ||
U.S. Plans | Fixed income securities | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Target allocation for plan assets, equity securities, minimum | 25.00% | ||
Target allocation for plan assets, equity securities, maximum | 35.00% | ||
Plan asset allocation, equity securities | 34.00% | ||
U.S. Plans | Other Security Investments [Member] | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Target allocation for plan assets, equity securities, maximum | 7.00% | ||
Plan asset allocation, equity securities | 4.00% | ||
Non-U.S. Plans | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Company contribution | $ 102 | $ 0 | |
Non-U.S. Plans | Equity securities | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Target allocation for plan assets, equity securities, maximum | 40.00% | ||
Plan asset allocation, equity securities | 28.00% | ||
Non-U.S. Plans | Fixed income securities | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Target allocation for plan assets, equity securities, maximum | 20.00% | ||
Plan asset allocation, equity securities | 22.00% | ||
Non-U.S. Plans | Other Security Investments [Member] | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Target allocation for plan assets, equity securities, maximum | 40.00% | ||
Plan asset allocation, equity securities | 50.00% |
Change in Projected Benefit Obl
Change in Projected Benefit Obligation/Accumulated Postretirement Benefit Obligation (Detail) - USD ($) $ in Millions | 12 Months Ended | |||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2014 | ||
Recognized in Consolidated Balance Sheets: | ||||
Noncurrent asset | $ (22) | $ (36) | ||
U.S. Pension Plans | ||||
Defined Benefit Plan, Change in Benefit Obligation [Roll Forward] | ||||
Benefit obligation-beginning of fiscal year | 1,005 | 983 | ||
Visa Europe acquisition | 0 | 0 | ||
Service cost | 13 | 47 | $ 46 | |
Interest cost | 40 | 40 | 42 | |
Actuarial loss (gain) | 86 | 40 | ||
Benefit payments | (64) | (105) | ||
Plan amendment | (8) | 0 | ||
Foreign currency exchange rate changes | 0 | 0 | ||
Benefit obligation-end of fiscal year | 1,072 | 1,005 | 983 | |
Accumulated benefit obligation | 1,072 | 994 | ||
Change in Plan Assets: | ||||
Fair value of plan assets-beginning of fiscal year | 1,022 | 1,117 | ||
Visa Europe acquisition | 0 | 0 | ||
Actual return on plan assets | 118 | (6) | ||
Company contribution | 1 | 16 | ||
Benefit payments | (64) | (105) | ||
Foreign currency exchange rate changes | 0 | 0 | ||
Fair value of plan assets-end of fiscal year | 1,077 | 1,022 | 1,117 | |
Funded status at end of fiscal year | 5 | 17 | ||
Recognized in Consolidated Balance Sheets: | ||||
Noncurrent asset | (22) | (36) | ||
Current liability | (9) | (9) | ||
Noncurrent liability | (8) | (10) | ||
Funded status at end of fiscal year | 5 | 17 | ||
U.S. Other Postretirement Benefits | ||||
Defined Benefit Plan, Change in Benefit Obligation [Roll Forward] | ||||
Benefit obligation-beginning of fiscal year | 18 | 20 | ||
Service cost | 0 | 0 | 0 | |
Interest cost | 1 | 1 | 1 | |
Actuarial loss (gain) | (2) | 0 | ||
Benefit payments | (3) | (3) | ||
Plan amendment | 0 | 0 | ||
Benefit obligation-end of fiscal year | 14 | 18 | 20 | |
Change in Plan Assets: | ||||
Fair value of plan assets-beginning of fiscal year | 0 | 0 | ||
Actual return on plan assets | 0 | 0 | ||
Company contribution | 3 | 3 | ||
Benefit payments | (3) | (3) | ||
Fair value of plan assets-end of fiscal year | 0 | 0 | $ 0 | |
Funded status at end of fiscal year | (14) | (18) | ||
Recognized in Consolidated Balance Sheets: | ||||
Noncurrent asset | 0 | 0 | ||
Current liability | (3) | (3) | ||
Noncurrent liability | (11) | (15) | ||
Funded status at end of fiscal year | (14) | (18) | ||
Non-U.S. Pension Plans | ||||
Defined Benefit Plan, Change in Benefit Obligation [Roll Forward] | ||||
Benefit obligation-beginning of fiscal year | 0 | |||
Visa Europe acquisition | 381 | |||
Service cost | [1] | 1 | ||
Interest cost | [1] | 3 | ||
Actuarial loss (gain) | 86 | |||
Benefit payments | (1) | |||
Plan amendment | 0 | |||
Foreign currency exchange rate changes | 4 | |||
Benefit obligation-end of fiscal year | 474 | 0 | ||
Accumulated benefit obligation | 474 | |||
Change in Plan Assets: | ||||
Fair value of plan assets-beginning of fiscal year | 0 | |||
Visa Europe acquisition | 287 | |||
Actual return on plan assets | 25 | |||
Company contribution | 102 | 0 | ||
Benefit payments | (1) | |||
Foreign currency exchange rate changes | 2 | |||
Fair value of plan assets-end of fiscal year | 415 | $ 0 | ||
Funded status at end of fiscal year | (59) | |||
Recognized in Consolidated Balance Sheets: | ||||
Noncurrent asset | 0 | |||
Current liability | (6) | |||
Noncurrent liability | (53) | |||
Funded status at end of fiscal year | $ (59) | |||
[1] | Represents Visa Europe's U.K. pension plans' net pension benefit cost recognized from the Closing through September 30, 2016. |
Amounts Recognized in Accumulat
Amounts Recognized in Accumulated Comprehensive Income Before Tax (Detail) - USD ($) $ in Millions | Sep. 30, 2016 | Sep. 30, 2015 |
U.S. Pension Plans | ||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||
Net actuarial loss (gain) | $ 241 | $ 232 |
Prior service credit | 0 | (9) |
Total | 241 | 223 |
U.S. Other Postretirement Benefits | ||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||
Net actuarial loss (gain) | (5) | (5) |
Prior service credit | (2) | (5) |
Total | (7) | $ (10) |
Non-U.S. Pension Plans | ||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||
Net actuarial loss (gain) | 66 | |
Prior service credit | 0 | |
Total | $ 66 |
Amounts from Accumulated Other
Amounts from Accumulated Other Comprehensive Income to be Amortized into Net Periodic Benefit Cost (Detail) $ in Millions | 12 Months Ended |
Sep. 30, 2016USD ($) | |
U.S. Pension Plans | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |
Actuarial loss (gain) | $ 15 |
Prior service credit | 0 |
Total | 15 |
U.S. Other Postretirement Benefits | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |
Actuarial loss (gain) | (1) |
Prior service credit | (2) |
Total | (3) |
Non-U.S. Pension Plans | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |
Actuarial loss (gain) | 2 |
Prior service credit | 0 |
Total | $ 2 |
Benefit Obligation and Fair Val
Benefit Obligation and Fair Value of Plan Assets with Obligations in Excess of Plan Assets (Detail) - USD ($) $ in Millions | Sep. 30, 2016 | Sep. 30, 2015 |
U.S. Plans | ||
Accumulated benefit obligation in excess of plan assets | ||
Accumulated benefit obligation, end of year | $ (16) | $ (19) |
Fair value of plan assets, end of year | 0 | 0 |
Projected benefit obligation in excess of plan assets | ||
Benefit obligation, end of year | (16) | (19) |
Fair value of plan assets, end of year | 0 | $ 0 |
Non-U.S. Plans | ||
Accumulated benefit obligation in excess of plan assets | ||
Accumulated benefit obligation, end of year | (474) | |
Fair value of plan assets, end of year | 415 | |
Projected benefit obligation in excess of plan assets | ||
Benefit obligation, end of year | (474) | |
Fair value of plan assets, end of year | $ 415 |
Components of Net Periodic Bene
Components of Net Periodic Benefit Cost (Detail) - USD ($) $ in Millions | 12 Months Ended | |||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2014 | ||
U.S. Pension Plans | ||||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||||
Service cost | $ 13 | $ 47 | $ 46 | |
Interest cost | 40 | 40 | 42 | |
Expected return on assets | (69) | (72) | (68) | |
Prior service credit | (1) | (7) | (8) | |
Actuarial loss (gain) | 7 | 1 | 1 | |
Net benefit cost | (10) | 9 | 13 | |
Curtailment gain | (8) | 0 | (3) | |
Settlement loss | 13 | 7 | 3 | |
Total net periodic benefit cost | (5) | 16 | 13 | |
U.S. Other Postretirement Benefits | ||||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||||
Service cost | 0 | 0 | 0 | |
Interest cost | 1 | 1 | 1 | |
Expected return on assets | 0 | 0 | 0 | |
Prior service credit | (3) | (3) | (3) | |
Actuarial loss (gain) | (2) | (2) | (1) | |
Net benefit cost | (4) | (4) | (3) | |
Curtailment gain | 0 | 0 | 0 | |
Settlement loss | 0 | 0 | 0 | |
Total net periodic benefit cost | (4) | $ (4) | $ (3) | |
Non-U.S. Pension Plans | ||||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||||
Service cost | [1] | 1 | ||
Interest cost | [1] | 3 | ||
Expected return on assets | [1] | (4) | ||
Prior service credit | [1] | 0 | ||
Actuarial loss (gain) | [1] | 0 | ||
Net benefit cost | [1] | 0 | ||
Curtailment gain | [1] | 0 | ||
Settlement loss | [1] | 0 | ||
Total net periodic benefit cost | [1] | $ 0 | ||
[1] | Represents Visa Europe's U.K. pension plans' net pension benefit cost recognized from the Closing through September 30, 2016. |
Other Changes in Plan Assets an
Other Changes in Plan Assets and Benefit Obligations Recognized in Other Comprehensive Income (Detail) - USD ($) $ in Millions | 12 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2014 | |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Current year actuarial loss (gain) | $ 106 | $ 122 | $ 27 |
Amortization of prior service credit/(cost) | (10) | 1 | $ 8 |
U.S. Pension Plans | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Current year actuarial loss (gain) | 30 | 119 | |
Amortization of actuarial (loss) gain | (20) | (8) | |
Current year prior service credit | 0 | 0 | |
Amortization of prior service credit/(cost) | 9 | 7 | |
Total recognized in other comprehensive income | 19 | 118 | |
Total recognized in net periodic benefit cost and other comprehensive income | 14 | 134 | |
U.S. Other Postretirement Benefits | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Current year actuarial loss (gain) | (2) | 0 | |
Amortization of actuarial (loss) gain | 2 | 2 | |
Current year prior service credit | 0 | 0 | |
Amortization of prior service credit/(cost) | 3 | 3 | |
Total recognized in other comprehensive income | 3 | 5 | |
Total recognized in net periodic benefit cost and other comprehensive income | (1) | $ 1 | |
Non-U.S. Pension Plans | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Current year actuarial loss (gain) | 66 | ||
Amortization of actuarial (loss) gain | 0 | ||
Current year prior service credit | 0 | ||
Amortization of prior service credit/(cost) | 0 | ||
Total recognized in other comprehensive income | 66 | ||
Total recognized in net periodic benefit cost and other comprehensive income | $ 66 |
Weighted Average Actuarial Assu
Weighted Average Actuarial Assumptions (Detail) | 12 Months Ended | |||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2014 | ||
U.S. Pension Plans | ||||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||||
Discount rate for benefit obligation | [1] | 3.62% | 4.33% | 4.27% |
Discount rate for net periodic benefit cost | 4.33% | 4.27% | 4.81% | |
Non-U.S. Pension Plans | ||||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||||
Discount rate for benefit obligation | [1] | 2.40% | ||
Discount rate for net periodic benefit cost | 3.10% | |||
Expected long-term rate of return on plan assets | [2] | 3.92% | ||
Rate of increase in compensation levels for: | ||||
Benefit obligation | 3.20% | |||
Net periodic benefit cost | 3.00% | |||
U.S. Other Postretirement Benefits | ||||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||||
Discount rate for benefit obligation | [1] | 1.91% | 2.43% | 2.59% |
Discount rate for net periodic benefit cost | 2.43% | 2.59% | 2.76% | |
Expected long-term rate of return on plan assets | [2] | 7.00% | 7.00% | 7.00% |
Rate of increase in compensation levels for: | ||||
Benefit obligation | 4.00% | 4.00% | ||
Net periodic benefit cost | 4.00% | 4.50% | ||
[1] | Represents a single weighted-average discount rate derived based on a cash flow matching analysis, with the projected benefit payments matching spot rates from a yield curve developed from high-quality corporate bonds. | |||
[2] | Primarily based on the targeted allocation, and evaluated for reasonableness by considering such factors as: (i) actual return on plan assets; (ii) historical rates of return on various asset classes in the portfolio; (iii) projections of returns on various asset classes; and (iv) current and prospective capital market conditions and economic forecasts. |
Plan's Investments at Fair Valu
Plan's Investments at Fair Value (Detail) - USD ($) $ in Millions | Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2014 |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Fair Value, Assets, Level 1 to Level 2 Transfers, Amount | $ 0 | ||
U.S. Plans | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Fair Value Measurements | 1,077 | $ 1,022 | $ 1,117 |
Non-U.S. Plans | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Fair Value Measurements | 415 | 0 | |
Pension Benefits | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Fair Value, Assets, Level 1 to Level 2 Transfers, Amount | 0 | 0 | |
Fair Value, Measurements, Recurring | Level 1 | U.S. Plans | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Fair Value Measurements | 811 | 756 | |
Fair Value, Measurements, Recurring | Level 1 | Non-U.S. Plans | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Fair Value Measurements | 273 | ||
Fair Value, Measurements, Recurring | Level 1 | Cash equivalents | U.S. Plans | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Fair Value Measurements | 39 | 11 | |
Fair Value, Measurements, Recurring | Level 1 | Cash equivalents | Non-U.S. Plans | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Fair Value Measurements | 105 | ||
Fair Value, Measurements, Recurring | Level 1 | U.S. treasury securities | U.S. Plans | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Fair Value Measurements | 100 | 74 | |
Fair Value, Measurements, Recurring | Level 1 | U.K. treasury securities | Non-U.S. Plans | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Fair Value Measurements | 52 | ||
Fair Value, Measurements, Recurring | Level 1 | Equity securities | U.S. Plans | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Fair Value Measurements | 672 | 671 | |
Fair Value, Measurements, Recurring | Level 1 | Equity securities | Non-U.S. Plans | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Fair Value Measurements | 116 | ||
Fair Value, Measurements, Recurring | Level 2 | U.S. Plans | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Fair Value Measurements | 215 | 235 | |
Fair Value, Measurements, Recurring | Level 2 | Non-U.S. Plans | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Fair Value Measurements | 113 | ||
Fair Value, Measurements, Recurring | Level 2 | Corporate debt securities | U.S. Plans | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Fair Value Measurements | 185 | 169 | |
Fair Value, Measurements, Recurring | Level 2 | Corporate debt securities | Non-U.S. Plans | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Fair Value Measurements | 39 | ||
Fair Value, Measurements, Recurring | Level 2 | U.S. government-sponsored debt securities | U.S. Plans | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Fair Value Measurements | 30 | 66 | |
Fair Value, Measurements, Recurring | Level 2 | Multi-asset securities | Non-U.S. Plans | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Fair Value Measurements | 74 | ||
Fair Value, Measurements, Recurring | Level 3 | U.S. Plans | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Fair Value Measurements | 51 | 31 | |
Fair Value, Measurements, Recurring | Level 3 | Non-U.S. Plans | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Fair Value Measurements | 29 | ||
Fair Value, Measurements, Recurring | Level 3 | Asset-backed securities | U.S. Plans | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Fair Value Measurements | 51 | 31 | |
Fair Value, Measurements, Recurring | Level 3 | Asset-backed securities | Non-U.S. Plans | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Fair Value Measurements | 29 | ||
Total | Fair Value, Measurements, Recurring | U.S. Plans | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Fair Value Measurements | 1,077 | 1,022 | |
Total | Fair Value, Measurements, Recurring | Non-U.S. Plans | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Fair Value Measurements | 415 | ||
Total | Fair Value, Measurements, Recurring | Cash equivalents | U.S. Plans | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Fair Value Measurements | 39 | 11 | |
Total | Fair Value, Measurements, Recurring | Cash equivalents | Non-U.S. Plans | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Fair Value Measurements | 105 | ||
Total | Fair Value, Measurements, Recurring | Corporate debt securities | U.S. Plans | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Fair Value Measurements | 185 | 169 | |
Total | Fair Value, Measurements, Recurring | Corporate debt securities | Non-U.S. Plans | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Fair Value Measurements | 39 | ||
Total | Fair Value, Measurements, Recurring | U.S. government-sponsored debt securities | U.S. Plans | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Fair Value Measurements | 30 | 66 | |
Total | Fair Value, Measurements, Recurring | U.S. treasury securities | U.S. Plans | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Fair Value Measurements | 100 | 74 | |
Total | Fair Value, Measurements, Recurring | U.K. treasury securities | Non-U.S. Plans | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Fair Value Measurements | 52 | ||
Total | Fair Value, Measurements, Recurring | Asset-backed securities | U.S. Plans | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Fair Value Measurements | 51 | 31 | |
Total | Fair Value, Measurements, Recurring | Asset-backed securities | Non-U.S. Plans | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Fair Value Measurements | 29 | ||
Total | Fair Value, Measurements, Recurring | Equity securities | U.S. Plans | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Fair Value Measurements | 672 | $ 671 | |
Total | Fair Value, Measurements, Recurring | Equity securities | Non-U.S. Plans | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Fair Value Measurements | 116 | ||
Total | Fair Value, Measurements, Recurring | Multi-asset securities | Non-U.S. Plans | |||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | |||
Fair Value Measurements | $ 74 |
Cash Flows - Actual Employer Co
Cash Flows - Actual Employer Contributions (Detail) - USD ($) $ in Millions | 12 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | |
U.S. Pension Plans | ||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||
Actual employer contributions | $ 1 | $ 16 |
Expected employer contributions | ||
Expected employer contributions 2017 | 9 | |
Expected benefit payments | ||
Expected benefit payments 2017 | 165 | |
Expected benefit payments 2018 | 88 | |
Expected benefit payments 2019 | 85 | |
Expected benefit payments 2020 | 84 | |
Expected benefit payments 2021 | 81 | |
Expected benefit payments 2022-2026 | 350 | |
U.S. Other Postretirement Benefits | ||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||
Actual employer contributions | 3 | 3 |
Expected employer contributions | ||
Expected employer contributions 2017 | 3 | |
Expected benefit payments | ||
Expected benefit payments 2017 | 3 | |
Expected benefit payments 2018 | 3 | |
Expected benefit payments 2019 | 2 | |
Expected benefit payments 2020 | 2 | |
Expected benefit payments 2021 | 2 | |
Expected benefit payments 2022-2026 | 2 | |
Non-U.S. Pension Plans | ||
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] | ||
Actual employer contributions | 102 | $ 0 |
Expected employer contributions | ||
Expected employer contributions 2017 | 6 | |
Expected benefit payments | ||
Expected benefit payments 2017 | 4 | |
Expected benefit payments 2018 | 4 | |
Expected benefit payments 2019 | 5 | |
Expected benefit payments 2020 | 5 | |
Expected benefit payments 2021 | 5 | |
Expected benefit payments 2022-2026 | $ 27 |
Settlement Guarantee Manageme84
Settlement Guarantee Management - Additional Information (Detail) $ in Millions | 12 Months Ended | |
Sep. 30, 2016USD ($)month | Sep. 30, 2015USD ($) | |
Settlement Guarantee Management [Abstract] | ||
Number of Rolling Months of Average Chargebacks Volume Included in Settlement Risk Exposure | month | 4 | |
Estimated maximum settlement exposure | $ 67,800 | $ 43,500 |
Covered settlement exposure | 2,900 | 2,200 |
Estimated probability-weighted value of the guarantee | $ 2 | $ 1 |
Collateral (Detail)
Collateral (Detail) - USD ($) $ in Millions | Sep. 30, 2016 | Sep. 30, 2015 | |
Business Acquisition [Line Items] | |||
Cash equivalents | $ 1,295 | $ 1,023 | |
Pledged securities at market value | 170 | 154 | |
Letters of credit | 1,311 | 1,178 | |
Guarantees | 1,418 | 971 | |
Total | 4,194 | $ 3,326 | |
Visa Europe | |||
Business Acquisition [Line Items] | |||
Cash equivalents | [1] | 294 | |
Pledged securities at market value | 0 | ||
Letters of credit | 144 | ||
Guarantees | 375 | ||
Total | $ 813 | ||
[1] | Cash collateral held by Visa Europe is not included on the Company's consolidated balance sheet as its clients retain beneficial ownership and the cash is only accessible to the Company in the event of default by the client on its settlement obligations. |
Derivative Financial Instrume86
Derivative Financial Instruments - Additional Information (Detail) - USD ($) $ in Millions | 12 Months Ended | ||||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2014 | Jun. 21, 2016 | ||
Derivative [Line Items] | |||||
Reduction in earnings from excluded forward points and ineffectiveness | $ 30 | $ 29 | $ 27 | ||
Expected amount of accumulated other comprehensive income (loss) expected to be reclassified | 58 | ||||
Gain (Loss) on Foreign Currency Derivatives Recorded in Earnings, Net | 74 | ||||
Other Comprehensive Income (Loss), Foreign Currency Transaction and Translation Adjustment, Net of Tax | (218) | 1 | $ (1) | ||
Foreign exchange derivative instruments | |||||
Derivative [Line Items] | |||||
The aggregate notional amount of the Company's foreign currency forward contracts outstanding | 1,600 | 1,200 | |||
Increase in aggregate notional amounts | 189 | ||||
Prepaid Expenses and Other Current Assets [Member] | |||||
Derivative [Line Items] | |||||
Cash flow hedges in an asset position | 17 | ||||
Accrued Liabilities | |||||
Derivative [Line Items] | |||||
Cash flow hedges in a liability position | 78 | ||||
Collateral received with counterparties | 8 | ||||
Other Assets | |||||
Derivative [Line Items] | |||||
Posted collateral | 54 | ||||
Visa Europe | |||||
Derivative [Line Items] | |||||
Deferred cash consideration liability | [1] | $ 1,236 | |||
Net investment | 18,800 | ||||
Visa Europe | Foreign exchange derivative instruments | |||||
Derivative [Line Items] | |||||
The aggregate notional amount of the Company's foreign currency forward contracts outstanding | $ 1,100 | $ 0 | |||
Designated as Hedging Instrument | Visa Europe | |||||
Derivative [Line Items] | |||||
Deferred cash consideration liability | $ 1,200 | ||||
[1] | This amount reflects the fair value of deferred cash consideration of €1.0 billion, plus 4.0% compound annual interest, payable on the third anniversary of the Closing, discounted at a rate of 1.2%. |
Long-Lived Net Property, Equipm
Long-Lived Net Property, Equipment and Technology Assets Classified by Major Geographic Area (Detail) - USD ($) $ in Millions | Sep. 30, 2016 | Sep. 30, 2015 |
Segment Reporting Information [Line Items] | ||
Property, equipment and technology, net | $ 2,150 | $ 1,888 |
United States | ||
Segment Reporting Information [Line Items] | ||
Property, equipment and technology, net | 1,827 | 1,806 |
Countries Outside of United States | ||
Segment Reporting Information [Line Items] | ||
Property, equipment and technology, net | $ 323 | $ 82 |
Enterprise-wide Disclosures a88
Enterprise-wide Disclosures and Concentration of Business - Additional Information (Detail) | 12 Months Ended | ||
Sep. 30, 2016country | Sep. 30, 2015countrycustomer | Sep. 30, 2014countrycustomer | |
Geographic Concentration Risk | Total Operating Revenue | |||
Concentration Risk [Line Items] | |||
Number of countries, outside the United States, that exceeded 10% | 0 | 0 | 0 |
Customer Concentration Risk | Net Operating Revenue | |||
Concentration Risk [Line Items] | |||
Number of customers that exceeded 10% | 0 | 0 | 0 |
United States | Geographic Concentration Risk | Total Operating Revenue | |||
Concentration Risk [Line Items] | |||
Concentration Risk, Percentage | 52.00% | 53.00% | 54.00% |
Stockholders' Equity - Addition
Stockholders' Equity - Additional Information (Detail) $ / shares in Units, $ in Millions | Mar. 19, 2015conversion_rate | Sep. 30, 2016USD ($)conversion_rate$ / sharesshares | Oct. 31, 2016$ / shares | Jul. 21, 2016USD ($) | Jun. 21, 2016USD ($)shares | Oct. 31, 2015USD ($) | Sep. 30, 2015USD ($)shares | |||
Class of Stock [Line Items] | ||||||||||
Stock repurchase plan, remaining authorized funds | $ 5,800 | |||||||||
Dividends, paid | $ 1,400 | |||||||||
Dividends, paid per share | $ / shares | $ 0.14 | |||||||||
Subsequent Event | ||||||||||
Class of Stock [Line Items] | ||||||||||
Dividends, per share amount declared | $ / shares | $ 0.165 | |||||||||
Deposit into Litigation Escrow | ||||||||||
Class of Stock [Line Items] | ||||||||||
Deposits into litigation escrow account | $ 0 | |||||||||
October 2015 Share Repurchase Program | ||||||||||
Class of Stock [Line Items] | ||||||||||
Share repurchase plan, authorized amount | $ 5,000 | |||||||||
July 2016 Share Repurchase Program | ||||||||||
Class of Stock [Line Items] | ||||||||||
Share repurchase plan, authorized amount | $ 5,000 | |||||||||
Class A common stock | ||||||||||
Class of Stock [Line Items] | ||||||||||
Common stock, shares, outstanding | shares | 1,871,000,000 | [1] | 1,950,000,000 | |||||||
Common Stock, Value, Outstanding | $ 0 | $ 0 | ||||||||
Common stock split, conversion ratio | 4 | |||||||||
Class B common stock | ||||||||||
Class of Stock [Line Items] | ||||||||||
Common stock, shares, outstanding | shares | 245,000,000 | 245,000,000 | ||||||||
Common Stock, Value, Outstanding | $ 0 | $ 0 | ||||||||
Common stock, conversion rate | conversion_rate | [2] | 1.6483 | 1.6483 | |||||||
Class C common stock | ||||||||||
Class of Stock [Line Items] | ||||||||||
Common stock, shares, outstanding | shares | 17,000,000 | 550,000 | 20,000,000 | |||||||
Common Stock, Value, Outstanding | $ 0 | $ (170) | [3] | $ 0 | ||||||
Common stock, conversion rate | conversion_rate | 4 | 4 | ||||||||
Class C common stock | Accelerated Share Repurchase Program Aggregate | ||||||||||
Class of Stock [Line Items] | ||||||||||
Shares of class C common stock released from transfer restrictions, converted to class A common stock | shares | 134,000,000 | |||||||||
Preferred Stock | ||||||||||
Class of Stock [Line Items] | ||||||||||
Preferred stock, shares outstanding | shares | 5,000,000 | 0 | ||||||||
[1] | {F|ahBzfndlYmZpbGluZ3MtaHJkcmoLEgZYTUxEb2MiXlhCUkxEb2NHZW5JbmZvOmVhOWM1MDkzNjQ1MjRmNzk4OTM0M2I5ZDEyODM0M2JlfFRleHRTZWxlY3Rpb246OENBNzc3NzIxMjY1M0Y0NTY4MDI2RUY3NTNDRjY1NjMM} | |||||||||
[2] | The class B to class A common stock conversion rate is presented on a rounded basis. Conversion calculations for dividend payments are based on a conversion rate rounded to the tenth decimal. | |||||||||
[3] | the fair value of the Visa class C common stock held by Visa Europe as of the Closing. |
Number of Shares of Class A Com
Number of Shares of Class A Common Shares Outstanding on an As-Converted Basis (Detail) | Sep. 30, 2016conversion_rateshares | Sep. 30, 2016conversion_rateshares | Sep. 30, 2015shares | Jun. 21, 2016shares | Mar. 19, 2015conversion_rate | |||
Class of Stock [Line Items] | ||||||||
Stock Repurchased and Retired During Period, Shares | 1,000,000 | |||||||
Conversion of class C common stock upon sale into public market (in shares) | [1] | 2,422,000,000 | ||||||
Initial conversion rate of UK&I and Europe preferred stock into class A common or class A equivalent preferred stock | 13.952 | |||||||
Series B Preferred Stock | ||||||||
Class of Stock [Line Items] | ||||||||
Preferred stock, shares outstanding | 2,000,000 | 2,000,000 | 0 | |||||
preferred stock series B conversion rate | conversion_rate | 13.9520 | 13.9520 | ||||||
Shares Outstanding As Converted Basis | [1] | 35,000,000 | 35,000,000 | |||||
Series C Preferred Stock | ||||||||
Class of Stock [Line Items] | ||||||||
Preferred stock, shares outstanding | 3,000,000 | 3,000,000 | 0 | |||||
Shares Outstanding As Converted Basis | [1] | 44,000,000 | 44,000,000 | |||||
preferred stock series C conversion rate | conversion_rate | 13.9520 | 13.9520 | ||||||
Class A common stock | ||||||||
Class of Stock [Line Items] | ||||||||
Stock Repurchased and Retired During Period, Shares | [3] | 91,000,000 | [2] | 44,000,000 | ||||
Common stock, shares, outstanding | 1,871,000,000 | [4] | 1,871,000,000 | [4] | 1,950,000,000 | |||
Conversion of class C common stock upon sale into public market (in shares) | [1],[4] | 1,871,000,000 | ||||||
Class B common stock | ||||||||
Class of Stock [Line Items] | ||||||||
Common stock, shares, outstanding | 245,000,000 | 245,000,000 | 245,000,000 | |||||
Common stock, conversion rate | conversion_rate | [5] | 1.6483 | 1.6483 | 1.6483 | ||||
Conversion of class C common stock upon sale into public market (in shares) | [1] | 405,000,000 | ||||||
Class C common stock | ||||||||
Class of Stock [Line Items] | ||||||||
Common stock, shares, outstanding | 17,000,000 | 17,000,000 | 20,000,000 | 550,000 | ||||
Common stock, conversion rate | conversion_rate | 4 | 4 | 4 | |||||
Conversion of class C common stock upon sale into public market (in shares) | [1] | 67,000,000 | ||||||
Visa Europe | ||||||||
Class of Stock [Line Items] | ||||||||
Initial conversion rate of UK&I and Europe preferred stock into class A common or class A equivalent preferred stock | 13.952 | |||||||
[1] | Figures in the table may not recalculate exactly due to rounding. As-converted class A common stock is calculated based on unrounded numbers. | |||||||
[2] | (in millions, except per share data)2016 (1) 2015Shares repurchased in the open market(2)91 44Average repurchase price per share(3)$77.05 $65.98Total cost$6,987 $2,910 | |||||||
[3] | All shares repurchased in the open market have been retired and constitute authorized but unissued shares. | |||||||
[4] | {F|ahBzfndlYmZpbGluZ3MtaHJkcmoLEgZYTUxEb2MiXlhCUkxEb2NHZW5JbmZvOmVhOWM1MDkzNjQ1MjRmNzk4OTM0M2I5ZDEyODM0M2JlfFRleHRTZWxlY3Rpb246OENBNzc3NzIxMjY1M0Y0NTY4MDI2RUY3NTNDRjY1NjMM} | |||||||
[5] | The class B to class A common stock conversion rate is presented on a rounded basis. Conversion calculations for dividend payments are based on a conversion rate rounded to the tenth decimal. |
Stockholders' Equity Share Repu
Stockholders' Equity Share Repurchases in the Open Market (Details) - USD ($) $ / shares in Units, shares in Millions, $ in Millions | Sep. 30, 2016 | Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2014 | ||
Class of Stock [Line Items] | ||||||
Shares repurchased in the open market | 1 | |||||
Total cost | $ 120 | $ 6,987 | $ 2,910 | $ 4,118 | ||
Class A common stock | ||||||
Class of Stock [Line Items] | ||||||
Shares repurchased in the open market | [2] | 91 | [1] | 44 | ||
Average repurchase price per share | [3] | $ 77.05 | [1] | $ 65.98 | ||
Total cost | $ 6,987 | [1] | $ 2,910 | |||
[1] | (in millions, except per share data)2016 (1) 2015Shares repurchased in the open market(2)91 44Average repurchase price per share(3)$77.05 $65.98Total cost$6,987 $2,910 | |||||
[2] | All shares repurchased in the open market have been retired and constitute authorized but unissued shares. | |||||
[3] | Figures in the table may not recalculate exactly due to rounding. Average repurchase price per share is calculated based on unrounded numbers. |
Stockholders' Equity Effect of
Stockholders' Equity Effect of Escrow Funding on the Company Repurchaseing its Common Stock (Details) shares in Millions, $ in Millions | Sep. 30, 2016conversion_rateshares | Sep. 30, 2016USD ($)conversion_rate | Mar. 19, 2015conversion_rate | |
Class of Stock [Line Items] | ||||
As-converted class B common stock outstanding after deposits | [1] | 2,422 | ||
Deposit into Litigation Escrow | ||||
Class of Stock [Line Items] | ||||
Deposits under the retrospective responsibility plan | $ | $ 0 | |||
Class A common stock | ||||
Class of Stock [Line Items] | ||||
As-converted class B common stock outstanding after deposits | [1],[2] | 1,871 | ||
Class B common stock | ||||
Class of Stock [Line Items] | ||||
Common stock, conversion rate | conversion_rate | [3] | 1.6483 | 1.6483 | 1.6483 |
As-converted class B common stock outstanding after deposits | [1] | 405 | ||
[1] | Figures in the table may not recalculate exactly due to rounding. As-converted class A common stock is calculated based on unrounded numbers. | |||
[2] | {F|ahBzfndlYmZpbGluZ3MtaHJkcmoLEgZYTUxEb2MiXlhCUkxEb2NHZW5JbmZvOmVhOWM1MDkzNjQ1MjRmNzk4OTM0M2I5ZDEyODM0M2JlfFRleHRTZWxlY3Rpb246OENBNzc3NzIxMjY1M0Y0NTY4MDI2RUY3NTNDRjY1NjMM} | |||
[3] | The class B to class A common stock conversion rate is presented on a rounded basis. Conversion calculations for dividend payments are based on a conversion rate rounded to the tenth decimal. |
Basic and Diluted Earnings Per
Basic and Diluted Earnings Per Share (Detail) $ / shares in Units, shares in Millions, $ in Millions | Mar. 19, 2015 | Sep. 30, 2016USD ($)$ / sharesshares | Sep. 30, 2015USD ($)$ / sharesshares | Sep. 30, 2014USD ($)$ / sharesshares | ||
Schedule of Earnings Per Share, Basic and Diluted, by Common Class, Including Two Class Method [Line Items] | ||||||
Income allocation - Basic | $ | [1] | $ 5,991 | $ 6,328 | $ 5,438 | ||
Dilutive shares of outstanding stock awards included in computation of weighted-average dilutive shares outstanding | 5 | 6 | 7 | |||
Antidilutive Securities Excluded from Computation of Earnings Per Share, Amount | 2 | 2 | 2 | |||
Class A common stock | ||||||
Schedule of Earnings Per Share, Basic and Diluted, by Common Class, Including Two Class Method [Line Items] | ||||||
Income allocation - Basic | $ | [1] | $ 4,738 | $ 5,044 | $ 4,307 | ||
Weighted Average Shares Outstanding - Basic | 1,906 | [2] | 1,954 | 1,993 | ||
Earnings per Share - Basic | $ / shares | $ 2.49 | [2],[3] | $ 2.58 | $ 2.16 | ||
Income allocation - Diluted | $ | [1] | $ 5,991 | $ 6,328 | $ 5,438 | ||
Weighted Average Shares Outstanding - Diluted | 2,414 | [2],[3],[4] | 2,457 | 2,523 | ||
Earnings per Share - Diluted | $ / shares | $ 2.48 | [2],[3] | $ 2.58 | $ 2.16 | ||
Common stock split, conversion ratio | 4 | |||||
Class B common stock | ||||||
Schedule of Earnings Per Share, Basic and Diluted, by Common Class, Including Two Class Method [Line Items] | ||||||
Income allocation - Basic | $ | [1],[5] | $ 1,006 | $ 1,045 | $ 892 | ||
Weighted Average Shares Outstanding - Basic | 245 | [2] | 245 | 245 | ||
Earnings per Share - Basic | $ / shares | $ 4.10 | [2],[3],[5] | $ 4.26 | $ 3.63 | ||
Income allocation - Diluted | $ | [1],[5] | $ 1,004 | $ 1,042 | $ 890 | ||
Weighted Average Shares Outstanding - Diluted | 245 | [2],[3],[5] | 245 | 245 | ||
Earnings per Share - Diluted | $ / shares | $ 4.09 | [2],[3],[5] | $ 4.25 | $ 3.62 | ||
Weighted Average Number Shares Outstanding, As-Converted Basis | 405 | 405 | 413 | |||
Class C common stock | ||||||
Schedule of Earnings Per Share, Basic and Diluted, by Common Class, Including Two Class Method [Line Items] | ||||||
Income allocation - Basic | $ | [1],[5] | $ 185 | $ 224 | $ 222 | ||
Weighted Average Shares Outstanding - Basic | 19 | [2] | 22 | 26 | ||
Earnings per Share - Basic | $ / shares | $ 9.94 | [2],[3],[5] | $ 10.33 | $ 8.65 | ||
Income allocation - Diluted | $ | [1],[5] | $ 185 | $ 223 | $ 221 | ||
Weighted Average Shares Outstanding - Diluted | 19 | [2],[3],[5] | 22 | 26 | ||
Earnings per Share - Diluted | $ / shares | $ 9.93 | [2],[3],[5] | $ 10.30 | $ 8.62 | ||
Weighted Average Number Shares Outstanding, As-Converted Basis | 75 | 87 | 103 | |||
Participating Securities | ||||||
Schedule of Earnings Per Share, Basic and Diluted, by Common Class, Including Two Class Method [Line Items] | ||||||
Income allocation - Basic | $ | [1],[6] | $ 62 | $ 15 | $ 17 | ||
Income allocation - Diluted | $ | [1],[6] | $ 61 | $ 15 | $ 16 | ||
[1] | Net income attributable to Visa Inc. is allocated based on proportional ownership on an as-converted basis. The weighted-average number of shares of as-converted class B common stock used in the income allocation were 405 million for fiscal 2016 and 2015 and 413 million for fiscal 2014. The weighted-average number of shares of as-converted class C common stock used in the income allocation was 75 million, 87 million and 103 million for fiscal 2016, 2015 and 2014, respectively. | |||||
[2] | The Company did not include Visa Europe's financial results in the Company's consolidated statements of operations from the acquisition date, June 21, 2016, through June 30, 2016 as the impact was immaterial. The Company's consolidated statement of operations for the year ended September 30, 2016 includes Visa Europe's financial results for the three months ended September 30, 2016. See Note 2—Acquisition of Visa Europe. | |||||
[3] | Figures in the table may not recalculate exactly due to rounding. Earnings per share is calculated based on unrounded numbers. The number of shares and per share amounts for the prior periods presented have been retroactively adjusted to reflect the four-for-one stock split effected in the fiscal second quarter of 2015. See Note 14—Stockholders' Equity. | |||||
[4] | Weighted-average diluted shares outstanding are calculated on an as-converted basis, and include incremental common stock equivalents, as calculated under the treasury stock method. The computation includes 5 million, 6 million and 7 million common stock equivalents for fiscal 2016, 2015 and 2014, respectively, because their effect would have been dilutive. The computation excludes 2 million of common stock equivalents for fiscal 2016, 2015 and 2014 because their effect would have been anti-dilutive. | |||||
[5] | . | |||||
[6] | Participating securities include preferred stock outstanding and unvested share-based payment awards that contain non-forfeitable rights to dividends or dividend equivalents, such as the Company's U.K.&I and Europe preferred stock, restricted stock awards, restricted stock units and earned performance-based shares. U.K.&I and Europe preferred stock were issued as part of the purchase price consideration in connection with the Visa Europe acquisition and are convertible into a number of shares of class A common stock or class A equivalent preferred stock upon certain conditions. Participating securities' income is allocated based on the weighted-average number of shares of as-converted stock. See Note 2—Acquisition of Visa Europe and Note 14—Stockholders' Equity. |
Share-based Compensation - Addi
Share-based Compensation - Additional Information (Detail) $ / shares in Units, shares in Millions, $ in Millions | Mar. 19, 2015 | Sep. 30, 2016USD ($)$ / sharesshares | Sep. 30, 2015USD ($)$ / shares | Sep. 30, 2014USD ($)$ / shares |
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Maximum number of Class A Common Stock authorized for issuance under the 2007 Equity Incentive Compensation Plan ("the "EIP") | shares | 20 | |||
Share-based compensation expense | $ 211 | $ 184 | $ 172 | |
Employee Service Share-based Compensation, Tax Benefit from Compensation Expense | $ 62 | 54 | 51 | |
Share-based Compensation Arrangement by Share-based Payment Award, Expiration Period | 10 years | |||
Total intrinsic value from options exercised | $ 103 | 134 | 187 | |
Tax benefit realized from options exercised | 35 | 86 | 65 | |
Unrecognized compensation cost | $ 19 | |||
Total unrecognized compensation cost related to non-vested options expected to be recognized over a weighted average period (in years) | 1 year 4 months 24 days | |||
Total fair value of RSAs and RSUs vested | $ 142 | $ 132 | $ 126 | |
Weighted average remaining contractual term | 5 years 2 months 19 days | |||
Share-based Compensation Arrangement by Share-based Payment Award, Discount from Market Price, Purchase Date | 15.00% | |||
Employee Stock Option | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period from the date of grant | 3 years | |||
Restricted Stock Awards | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Unrecognized compensation cost | $ 54 | |||
Weighted average grant date fair value (in dollars per share) | $ / shares | $ 0 | $ 63.71 | $ 49.98 | |
Weighted average remaining contractual term | 10 months 6 days | |||
Restricted Stock Units | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Unrecognized compensation cost | $ 140 | |||
Weighted average grant date fair value (in dollars per share) | $ / shares | $ 79.77 | $ 62.88 | $ 49.44 | |
Weighted average remaining contractual term | 1 year 7 months 27 days | |||
Performance Based Shares | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Vesting period from the date of grant | 3 years | 3 years | 3 years | |
Unrecognized compensation cost | $ 18 | |||
Weighted average grant date fair value per share | $ / shares | $ 92.71 | $ 69.78 | $ 56.37 | |
Class A common stock | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Common stock split, conversion ratio | 4 | |||
Equity Incentive Compensation Plan, 2007 [Member] | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Maximum number of Class A Common Stock authorized for issuance under the 2007 Equity Incentive Compensation Plan ("the "EIP") | shares | 236 |
Assumptions Used to Estimate th
Assumptions Used to Estimate the Fair Value of Each Stock Option on the Date of Grant Using a Black-Scholes Option Pricing Model (Detail) - $ / shares | 12 Months Ended | |||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2014 | ||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Expected term (in years)(1) | [1] | 4 years 4 months 6 days | 4 years 6 months 18 days | 4 years 9 months 18 days |
Risk-free rate of return(2) | [2] | 1.50% | 1.50% | 1.30% |
Expected volatility(3) | [3] | 21.70% | 22.00% | 25.20% |
Expected dividend yield(4) | [4] | 0.70% | 0.80% | 0.80% |
Fair value per option granted | $ 15.01 | $ 12.04 | $ 11.03 | |
Minimum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Expected volatility(3) | 20.00% | 21.00% | 22.00% | |
Maximum | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Expected volatility(3) | 23.00% | 23.00% | 26.00% | |
Visa | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Expected term peer weighted percentage | 77.00% | 67.00% | 58.00% | |
Peer Companies | ||||
Share-based Compensation Arrangement by Share-based Payment Award [Line Items] | ||||
Expected term peer weighted percentage | 23.00% | 33.00% | 42.00% | |
[1] | This assumption is based on the Company's historical option exercises and those of a set of peer companies that management believes is generally comparable to Visa. The Company's data is weighted based on the number of years between the measurement date and Visa's initial public offering as a percentage of the options' contractual term. The relative weighting placed on Visa's data and peer data in fiscal 2016 was approximately 77% and 23%, respectively, 67% and 33% in fiscal 2015, respectively, and 58% and 42% in fiscal 2014, respectively. | |||
[2] | Based upon the zero coupon U.S. treasury bond rate over the expected term of the awards. | |||
[3] | Based on the Company’s implied and historical volatility. The expected volatilities ranged from 20% to 23% in fiscal 2016, 21% to 23% in fiscal 2015, and 22% to 26% in fiscal 2014. | |||
[4] | Based on the Company’s annual dividend rate on the date of grant. |
Summary of Option Activity (Det
Summary of Option Activity (Detail) $ / shares in Units, $ in Millions | 12 Months Ended | |
Sep. 30, 2016USD ($)$ / sharesshares | ||
Options | ||
Beginning balance | shares | 9,677,717 | |
Granted | shares | 1,438,048 | |
Forfeited | shares | (463,378) | |
Exercised | shares | (1,775,903) | |
Ending balance | shares | 8,876,484 | |
Options exercisable at September 30, 2016 | shares | 6,204,589 | |
Options exercisable and expected to be vested at September 30, 2015 | shares | 8,582,576 | [1] |
Share-based Compensation Arrangement by Share-based Payment Award, Options, Additional Disclosures [Abstract] | ||
Beginning balance | $ 28.07 | |
Granted | 79.98 | |
Forfeited | 21.76 | |
Exercised | 20 | |
Ending balance | 38.42 | |
Options exercisable at September 30, 2016 | 24.87 | |
Options exercisable and expected to vest at September 30, 2016(2) | $ 37.35 | [1] |
Weighted-Average Remaining Contractual Term | ||
Outstanding at September 30, 2016 | 5 years 2 months 19 days | |
Options exercisable at September 30, 2016 | 3 years 9 months 15 days | |
Options exercisable and expected to vest at September 30, 2016(2) | 5 years 1 month 10 days | [1] |
Aggregate Intrinsic Value | ||
Outstanding at September 30, 2016 | $ | $ 393 | |
Options exercisable at September 30, 2016 | $ | 359 | |
Options exercisable and expected to vest at September 30, 2016(2) | $ | $ 389 | [1] |
Stock price used to calculate aggregate intrinsic value | $ 82.7 | |
[1] | Applies a forfeiture rate to unvested options outstanding at September 30, 2016 to estimate the options expected to vest in the future. |
Summary of RSA and RSU Activity
Summary of RSA and RSU Activity (Detail) - $ / shares | 12 Months Ended | ||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2014 | |
Weighted-Average Remaining Contactual Term | |||
Outstanding at September 30, 2016 | 5 years 2 months 19 days | ||
Aggregate Intrinsic Value | |||
Stock price used to calculate aggregate intrinsic value | $ 82.7 | ||
Restricted Stock Awards | |||
Restricted stock | |||
Beginning balance | 4,064,687 | ||
Granted | 0 | ||
Vested | (2,061,406) | ||
Forfeited | (236,699) | ||
Ending balance | 1,766,582 | 4,064,687 | |
Weighted-Average Grant Date Fair Value | |||
Beginning balance | $ 54.09 | ||
Granted | 0 | $ 63.71 | $ 49.98 |
Vested | 49.06 | ||
Forfeited | 59.34 | ||
Ending balance | $ 59.26 | $ 54.09 | |
Weighted-Average Remaining Contactual Term | |||
Outstanding at September 30, 2016 | 10 months 6 days | ||
Aggregate Intrinsic Value | |||
Outstanding at September 30, 2016 | $ 146,000,000 | ||
Restricted Stock Units | |||
Restricted stock | |||
Beginning balance | 1,442,522 | ||
Granted | 2,735,115 | ||
Vested | (789,180) | ||
Forfeited | (241,503) | ||
Ending balance | 3,146,954 | 1,442,522 | |
Weighted-Average Grant Date Fair Value | |||
Beginning balance | $ 53.80 | ||
Granted | 79.77 | $ 62.88 | $ 49.44 |
Vested | 51.58 | ||
Forfeited | 73.02 | ||
Ending balance | $ 75.48 | $ 53.80 | |
Weighted-Average Remaining Contactual Term | |||
Outstanding at September 30, 2016 | 1 year 7 months 27 days | ||
Aggregate Intrinsic Value | |||
Outstanding at September 30, 2016 | $ 260,000,000 |
Summary of Performance-based Sh
Summary of Performance-based Shares Activity (Detail) | 12 Months Ended | |
Sep. 30, 2016$ / sharesshares | ||
Weighted- Average Remaining Contractual Term | ||
Outstanding at September 30, 2016 | 5 years 2 months 19 days | |
Aggregate Intrinsic Value | ||
Stock price used to calculate aggregate intrinsic value | $ 82.7 | |
Performance Awards | ||
Shares | ||
Beginning balance | shares | (1,263,962) | |
Granted | shares | 604,219 | [1] |
Vested | shares | (645,320) | |
Unearned | shares | 123,387 | |
Forfeited | shares | (57,462) | |
Ending balance | shares | (1,042,012) | |
Weighted- Average Grant Date Fair Value | ||
Beginning balance | $ 57.61 | |
Granted | 92.71 | [1] |
Vested | 54.59 | |
Unearned | 54.59 | |
Forfeited | 73.07 | |
Ending balance | $ 78.24 | |
Weighted- Average Remaining Contractual Term | ||
Outstanding at September 30, 2016 | 10 months 29 days | |
Aggregate Intrinsic Value | ||
Outstanding at September 30, 2016 | $ 86,000,000 | [2] |
[1] | Represents the maximum number of performance-based shares which could be earned. | |
[2] | Calculated by multiplying the closing stock price on the last trading day of fiscal 2016 of $82.70 by the number of instruments. |
Commitments and Contingencies -
Commitments and Contingencies - Additional Information (Detail) $ in Millions, € in Billions | 12 Months Ended | |||
Sep. 30, 2016USD ($) | Sep. 30, 2015USD ($) | Sep. 30, 2014USD ($) | Jun. 21, 2016EUR (€) | |
Other Commitments [Line Items] | ||||
Rent expense incurred | $ | $ 134 | $ 136 | $ 134 | |
Minimum | ||||
Other Commitments [Line Items] | ||||
Client Incentive Agreement Period | 1 year | |||
Maximum | ||||
Other Commitments [Line Items] | ||||
Client Incentive Agreement Period | 16 years | |||
Visa Europe | ||||
Other Commitments [Line Items] | ||||
Share capital of Visa Europe acquired (percent) | 100.00% | |||
Contingent consideration | € 1 | |||
Accrued interest on contingent consideration | € 0 |
Future Minimum Payments on Leas
Future Minimum Payments on Leases and Marketing and Sponsorship Agreements (Detail) $ in Millions | Sep. 30, 2016USD ($) |
Commitments and Contingencies Disclosure [Abstract] | |
Operating leases, 2017 | $ 126 |
Operating leases, 2018 | 103 |
Operating leases, 2019 | 82 |
Operating leases, 2020 | 61 |
Operating leases, 2021 | 57 |
Operating leases, Thereafter | 190 |
Operating leases | 619 |
Marketing and sponsorships, 2017 | 126 |
Marketing and sponsorships, 2018 | 128 |
Marketing and sponsorships, 2019 | 120 |
Marketing and sponsorships, 2020 | 110 |
Marketing and sponsorships, 2021 | 38 |
Marketing and sponsorships, Thereafter | 33 |
Marketing and sponsorships | 555 |
Total, 2017 | 252 |
Total, 2018 | 231 |
Total, 2019 | 202 |
Total, 2020 | 171 |
Total, 2021 | 95 |
Total, Thereafter | 223 |
Total | $ 1,174 |
Expected Reduction of Revenue f
Expected Reduction of Revenue for Volume and Support Incentive Agreements (Detail) $ in Millions | 12 Months Ended |
Sep. 30, 2016USD ($) | |
Commitments and Contingencies Disclosure [Abstract] | |
Client incentives, 2017 | $ 4,211 |
Client incentives, 2018 | 3,752 |
Client incentives, 2019 | 3,211 |
Client incentives, 2020 | 2,628 |
Client incentives, 2021 | 2,245 |
Client incentives, Thereafter | 4,617 |
Client incentives | $ 20,664 |
Related Parties Related Parties
Related Parties Related Parties (Details) $ in Millions | 12 Months Ended | ||
Sep. 30, 2016USD ($)entity | Sep. 30, 2015USD ($) | Sep. 30, 2014USD ($) | |
Related Party Disclosures [Abstract] | |||
Minimum ownership of Visa stock to be considered a related party, percent | 10.00% | ||
Minimum ownership interest in investee to be considered a related party, percent | 10.00% | ||
Number of entities owning more than 10% of Visa's total voting stock | entity | 0 | ||
Significant transactions with related parties | $ | $ 0 | $ 0 | $ 0 |
Income Taxes - Additional Infor
Income Taxes - Additional Information (Detail) - USD ($) $ / shares in Units, $ in Millions | Jun. 21, 2016 | Sep. 30, 2016 | Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2014 | ||
Tax Credit Carryforward [Line Items] | |||||||
US income before taxes | $ 5,839 | $ 7,214 | $ 6,140 | ||||
Deferred tax assets, net | $ 2,712 | $ 2,712 | $ 1,172 | ||||
U.S. federal statutory rate | 35.00% | 35.00% | 35.00% | ||||
Income tax provision, percent | 25.00% | 30.00% | 30.00% | ||||
Visa Europe Framework Agreement loss | $ 1,900 | $ 1,877 | $ 0 | $ 0 | |||
Revaluation of Visa Europe put option | 255 | ||||||
Unrecognized Tax Benefits, Period Increase (Decrease) | (296) | ||||||
Unrecognized Tax Benefits, Decrease Resulting from Prior Period Tax Positions | 0 | 239 | 0 | ||||
Effective Income Tax Rate Reconciliation, Deduction, Qualified Production Activity, Amount | 264 | ||||||
Prior years U.S. domestic production activities deduction | 0 | 0 | 191 | ||||
Income taxes receivable included in prepaid and other current assets | 232 | 232 | 77 | ||||
Income Taxes Receivable | 627 | ||||||
Income taxes payable included in accrued taxes as part of accrued liabilities | 153 | 153 | 75 | ||||
Accrued income taxes included in other long-term liabilities | [1] | 911 | 911 | 752 | |||
Cumulative undistributed earnings of the Company's international subsidiaries intended to be reinvested indefinitely outside the U.S | 8,300 | 8,300 | |||||
Decreased Singapore tax as a result of the tax incentive agreement | $ (235) | $ (192) | $ (168) | ||||
Benefit of the tax incentive agreement on diluted net income per share | $ 0.10 | $ 0.08 | $ 0.07 | ||||
Total unrecognized tax benefits exclusive of interest and penalties | 1,160 | $ 1,160 | $ 1,051 | $ 1,303 | |||
Unrecognized tax benefits, if recognized, would reduce the effective tax rate in a future period | 926 | 926 | 859 | ||||
Interest expense included in interest expense and administrative and other | 15 | (6) | 10 | ||||
Accrued penalties related to uncertain tax positions | 3 | 3 | 1 | 2 | |||
Accrued interest related to uncertain tax positions in other long term liabilities | 61 | 61 | 33 | ||||
Accrued penalties related to uncertain tax positions in other long term liabilities | 17 | 17 | 6 | ||||
Other Assets | |||||||
Tax Credit Carryforward [Line Items] | |||||||
Income Taxes Receivable | 731 | 731 | 627 | ||||
Visa Europe | |||||||
Tax Credit Carryforward [Line Items] | |||||||
Visa Europe Framework Agreement loss | $ 1,856 | [2] | 1,184 | ||||
Visa Europe | Other Assets | |||||||
Tax Credit Carryforward [Line Items] | |||||||
Deferred tax assets, net | 22 | 22 | 13 | ||||
Non United States Customers | |||||||
Tax Credit Carryforward [Line Items] | |||||||
US income before taxes | 2,500 | $ 2,400 | $ 2,300 | ||||
Federal | |||||||
Tax Credit Carryforward [Line Items] | |||||||
Net operating loss carryforwards | 17 | 17 | |||||
Federal foreign tax credit carryforward | 15 | 15 | |||||
State and Local Jurisdiction | |||||||
Tax Credit Carryforward [Line Items] | |||||||
Net operating loss carryforwards | 21 | 21 | |||||
Foreign Country | |||||||
Tax Credit Carryforward [Line Items] | |||||||
Net operating loss carryforwards | 117 | 117 | |||||
Foreign Country | Visa Europe | |||||||
Tax Credit Carryforward [Line Items] | |||||||
Tax benefit upon remeasurement of deferred tax liability to reflect tax rate change | $ (88) | $ (88) | |||||
[1] | The increase in non-current accrued income taxes is primarily related to the increase in liabilities for uncertain tax positions. | ||||||
[2] | the loss upon consummation of the transaction resulting from the effective settlement of the Framework Agreement between Visa and Visa Europe. The Visa Europe Framework Agreement provided Visa Europe with a perpetual, exclusive right to operate the Visa business in the Visa Europe region in exchange for a license fee paid to Visa. Under the terms of the Framework Agreement, the license fee paid by Visa Europe has increased modestly since inception in 2007, while the value of the Visa Europe business has increased at a greater rate. Using an income approach, the Company assessed the contractual terms and conditions of the Framework Agreement as compared to current market conditions and the historical and expected financial performance of Visa Europe. Based on the analysis performed, the Company determined that the terms were not at fair value as determined under U.S. GAAP at the Closing. The present value of the expected differential between payments required by the Framework Agreement and those that would be required if the contract were at fair value under U.S. GAAP was calculated over the Framework Agreement's contractual perpetual term, resulting in a loss of $1.9 billion recognized within operating expense in the Company's consolidated statement of operations during the third quarter of fiscal 2016, and a reduction to the purchase accounting consideration; and |
Income Before Taxes by Fiscal Y
Income Before Taxes by Fiscal Year (Detail) - USD ($) $ in Millions | 12 Months Ended | |||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2014 | ||
Income Tax Disclosure [Abstract] | ||||
U.S. | $ 5,839 | $ 7,214 | $ 6,140 | |
Non-U.S. | 2,173 | 1,781 | 1,584 | |
Income before income taxes | $ 8,012 | [1] | $ 8,995 | $ 7,724 |
[1] | The Company did not include Visa Europe's financial results in the Company's consolidated statements of operations from the acquisition date, June 21, 2016, through June 30, 2016 as the impact was immaterial. The Company's consolidated statement of operations for the year ended September 30, 2016 includes Visa Europe's financial results for the three months ended September 30, 2016. See Note 2—Acquisition of Visa Europe. |
Income Tax Expense by Fiscal Ye
Income Tax Expense by Fiscal Year (Detail) - USD ($) $ in Millions | 12 Months Ended | |||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2014 | ||
Current: | ||||
U.S. federal | $ 2,250 | $ 1,991 | $ 2,353 | |
State and local | 181 | 168 | 237 | |
Non-U.S. | 368 | 300 | 274 | |
Total current taxes | 2,799 | 2,459 | 2,864 | |
Deferred: | ||||
U.S. federal | (508) | 181 | (576) | |
State and local | (63) | 1 | (31) | |
Non-U.S. | (207) | 26 | 29 | |
Total deferred taxes | (778) | 208 | (578) | |
Income tax provision | $ 2,021 | [1] | $ 2,667 | $ 2,286 |
[1] | The Company did not include Visa Europe's financial results in the Company's consolidated statements of operations from the acquisition date, June 21, 2016, through June 30, 2016 as the impact was immaterial. The Company's consolidated statement of operations for the year ended September 30, 2016 includes Visa Europe's financial results for the three months ended September 30, 2016. See Note 2—Acquisition of Visa Europe. |
Tax Effect of Temporary Differe
Tax Effect of Temporary Differences that Give Rise to Significant Portions of Deferred Tax Assets and Liabilities (Detail) - USD ($) $ in Millions | Sep. 30, 2016 | Sep. 30, 2015 |
Deferred Tax Assets | ||
Accrued compensation and benefits | $ 277 | $ 141 |
Comprehensive (income) loss | 106 | 51 |
Accrued litigation obligation | 373 | 391 |
Client incentives | 266 | 191 |
Net operating loss carryforwards | 32 | 50 |
Federal benefit of state taxes | 195 | 203 |
Federal benefit of foreign taxes | 1,214 | 0 |
Other | 280 | 185 |
Valuation allowance | 31 | 40 |
Deferred tax assets | 2,712 | 1,172 |
Deferred Tax Liabilities | ||
Property, equipment and technology, net | (278) | (315) |
Intangible assets | (7,013) | (3,964) |
Foreign taxes | (106) | (153) |
Other | (101) | 0 |
Deferred tax liabilities | (7,498) | (4,432) |
Net deferred tax liabilities | $ (4,786) | $ (3,260) |
Information that Causes the Inc
Information that Causes the Income Tax Expense to Differ from the Amount of Income Tax Determined by Applying the Applicable U.S. Federal Statutory Rate of 35% to Pretax Income (Detail) - USD ($) $ in Millions | 12 Months Ended | |||
Sep. 30, 2016 | Sep. 30, 2015 | Sep. 30, 2014 | ||
Income Tax Disclosure [Abstract] | ||||
U.S. federal income tax at statutory rate | $ 2,804 | $ 3,148 | $ 2,704 | |
State income taxes, net of federal benefit | 135 | 194 | 129 | |
Non-U.S. tax effect, net of federal benefit | (553) | (327) | (278) | |
Prior years U.S. domestic production activities deduction | 0 | 0 | (191) | |
Remeasurement of deferred tax liability | (88) | 0 | 0 | |
Reversal of prior years tax reserves related to the resolution of uncertain tax positions | 0 | (239) | 0 | |
Revaluation of Visa Europe put option | (89) | 0 | 0 | |
Other, net | (188) | (109) | (78) | |
Income tax provision | $ 2,021 | [1] | $ 2,667 | $ 2,286 |
U.S. federal income tax at statutory rate, percent | 35.00% | 35.00% | 35.00% | |
State income taxes, net of federal benefit, percent | 2.00% | 2.00% | 2.00% | |
Non-U.S. tax effect, net of federal benefit, percent | (7.00%) | (4.00%) | (4.00%) | |
Prior years U.S. domestic production activities deduction, percent | 0.00% | 0.00% | (2.00%) | |
Remeasurement of deferred tax liability, percent | (1.00%) | 0.00% | 0.00% | |
Reversal of prior years tax reserves related to the resolution of uncertain tax positions, percent | 0.00% | (2.00%) | 0.00% | |
Revaluation of Visa Europe put option, percent | (1.00%) | 0.00% | 0.00% | |
Other, net, percent | (3.00%) | (1.00%) | (1.00%) | |
Income tax expense, percent | 25.00% | 30.00% | 30.00% | |
[1] | The Company did not include Visa Europe's financial results in the Company's consolidated statements of operations from the acquisition date, June 21, 2016, through June 30, 2016 as the impact was immaterial. The Company's consolidated statement of operations for the year ended September 30, 2016 includes Visa Europe's financial results for the three months ended September 30, 2016. See Note 2—Acquisition of Visa Europe. |
Reconciliation of Beginning and
Reconciliation of Beginning and Ending Unrecognized Tax Benefits by Fiscal Year (Detail) - USD ($) $ in Millions | 12 Months Ended | |
Sep. 30, 2016 | Sep. 30, 2015 | |
Reconciliation of Unrecognized Tax Benefits, Excluding Amounts Pertaining to Examined Tax Returns [Roll Forward] | ||
Beginning Balance | $ 1,051 | $ 1,303 |
Increases of unrecognized tax benefits related to prior years | 153 | 44 |
Decreases of unrecognized tax benefits related to prior years | (180) | (413) |
Increases of unrecognized tax benefits related to current year | 138 | 120 |
Reductions to unrecognized tax benefits related to lapsing statute of limitations | (2) | (3) |
Ending Balance | $ 1,160 | $ 1,051 |
Legal Matters - Additional Info
Legal Matters - Additional Information (Detail) $ in Millions | Jan. 27, 2014USD ($) | Dec. 16, 2013USD ($) | Dec. 10, 2012USD ($) | Oct. 29, 2012USD ($) | Oct. 19, 2012 | Oct. 31, 2011financial_institution | Dec. 31, 2010financial_institutionentity | Sep. 30, 2015USD ($) | Sep. 30, 2016USD ($)litigation_casecase_filed | Sep. 30, 2015USD ($) | Sep. 30, 2014USD ($) | Sep. 30, 2015merchant | Sep. 30, 2015merchant | Sep. 30, 2016USD ($)case_filed | Dec. 31, 2004state | Oct. 11, 2012atm_operator |
Loss Contingencies [Line Items] | ||||||||||||||||
Distribution to class merchants, rate amount | 0.10% | |||||||||||||||
Distribution to class merchants, period | ||||||||||||||||
Consecutive months of distribution to class merchants | 8 months | |||||||||||||||
Decrease in deferred tax assets reflecting the current tax deduction related to payments made in connection with the covered litigation | $ 978 | |||||||||||||||
Class Plaintiffs | ||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||
Payments for legal settlements | $ 4,000 | $ 4,000 | $ 4,000 | |||||||||||||
Individual Plaintiffs | ||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||
Payments for legal settlements | $ 350 | |||||||||||||||
Consumer Interchange Litigation | ||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||
Damages sought by plaintiff from all defendants | $ 54,000 | |||||||||||||||
Interchange Opt Out Litigation | ||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||
Number of opt-out cases filed | case_filed | 50 | 50 | ||||||||||||||
Settlements reached by percentage of sales volume of merchants who opted out | 51.00% | 51.00% | ||||||||||||||
Indirect Purchaser Actions | ||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||
Number of states where consumers reside | state | 19 | |||||||||||||||
U.K. Merchant Litigation | ||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||
Number of plaintiffs | merchant | 100 | |||||||||||||||
Canadian Competition Proceedings | ||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||
Number of Financial Institutions | financial_institution | 10 | |||||||||||||||
Number of MasterCard entities | entity | 2 | |||||||||||||||
National ATM Council Class Action | ||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||
Number of non-bank ATM operators | atm_operator | 13 | |||||||||||||||
Consumer Class Actions | ||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||
Number of Financial Institutions | financial_institution | 3 | |||||||||||||||
Settled Litigation | ||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||
Payments on unsettled and settled matters | $ (47) | $ (446) | ||||||||||||||
Threatened Litigation | Europe Interchange Rate Litigation | ||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||
Number of plaintiffs | merchant | 30 | |||||||||||||||
Covered Litigation | Interchange Multidistrict Litigation | ||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||
Provision for legal matters | $ 1,100 | |||||||||||||||
Unsettled | ||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||
Provision for legal matters | $ 2 | $ 14 | ||||||||||||||
Covered Litigation | ||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||
Deposits into litigation escrow account | $ 450 | |||||||||||||||
Covered Litigation | Settled Litigation | ||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||
Payments on unsettled and settled matters | $ (528) | |||||||||||||||
Visa, MasterCard, and Certain U.S. Financial Institutions | Interchange Opt Out Litigation | ||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||
Number of claims filed | litigation_case | 4 | |||||||||||||||
Visa | Interchange Opt Out Litigation | ||||||||||||||||
Loss Contingencies [Line Items] | ||||||||||||||||
Number of claims filed | litigation_case | 3 |
Legal Matters Legal Matters - A
Legal Matters Legal Matters - Accrued Litigation (Details) $ in Millions | 1 Months Ended | 12 Months Ended | 36 Months Ended | |
Dec. 31, 2010financial_institution | Sep. 30, 2016USD ($) | Sep. 30, 2015USD ($) | Sep. 30, 2016USD ($) | |
Loss Contingency Accrual [Roll Forward] | ||||
Accrued Litigation, Beginning of Period | $ 1,024 | $ 1,456 | ||
Accrued Litigation, End of Period | 981 | 1,024 | $ 981 | |
Unsettled | ||||
Loss Contingency Accrual [Roll Forward] | ||||
Provision for unsettled legal matters | 2 | 14 | ||
Settled Litigation | ||||
Loss Contingency Accrual [Roll Forward] | ||||
Payments on unsettled and settled matters | (47) | (446) | ||
U.S. Covered Litigation | ||||
Loss Contingency Accrual [Roll Forward] | ||||
Accrued Litigation, Beginning of Period | 1,023 | 1,449 | ||
Accrued Litigation, End of Period | 978 | 1,023 | 978 | |
U.S. Covered Litigation | Settled Litigation | ||||
Loss Contingency Accrual [Roll Forward] | ||||
Payments on unsettled and settled matters | (45) | (426) | ||
Covered Litigation | Settled Litigation | ||||
Loss Contingency Accrual [Roll Forward] | ||||
Payments on unsettled and settled matters | (528) | |||
U.S. Covered Litigation | ||||
Loss Contingency Accrual [Roll Forward] | ||||
Accrued Litigation, Beginning of Period | 0 | |||
Provision for unsettled legal matters | 2 | |||
Accrued Litigation, End of Period | $ 2 | $ 0 | $ 2 | |
Canadian Competition Proceedings | ||||
Loss Contingencies [Line Items] | ||||
Number of Financial Institutions | financial_institution | 10 |