SEC Comment Letter for U-Haul Holding (UHAL) — Feb 6, 2007
U-Haul Holding Co /NV/ (UHAL, UHAL-B) (CIK 0000004457)
Date: Feb. 6, 2007 · CIK: 0000004457 · Accession: 0000000000-07-006287
AI Filing Summary & Sentiment
File numbers found in text: 001-10275
Letter
Re: AMERCO Form 10-K for the year ended March 31, 2006 Filed June 13, 2006 File No. 001-10275
Mail Stop 3561 January 26, 2007
Via Fax & U.S. Mail
Jason A. Berg, Chief Accounting Officer AMERCO 1325 Airmotive Way, Ste. 100 Reno, Nevada 89502
We have reviewed your filing and have the following comments. We think you should revise your document in future filings in response to these comments. If you disagree, we will consider your explanation as to why our comments are inapplicable or a revision is unnecessary. Please be as detailed as necessary in your explanation. In some of our comments, we may ask you to provide us with information so we may better understand your disclosure. After reviewing th is information, we may raise additional comments.
Please understand that the purpose of our re view process is to assist you in your compliance with the applicable disclosure requirements and to enhance the overall disclosure in your filing. We look forward to working with you in these respects. We welcome any questions you may have about our comments or any other aspect of our review. Feel free to call us at the telephone numbers listed at the end of this letter.
Please respond to confirm that such comments will be complied with, or, if certain of the comments are deemed inappropr iate, advise the staff of your reason. Your response should be submitted in electronic form, under the label “corresp” with a copy to the staff. Please respond w ithin ten (10) business days.
Jason A. Berg, Chief Accounting Officer AMERCO January 26, 2007 Page 2
Form 10-K for the fiscal year ended March 31, 2006
Item 7- Management’s Discussion and Analysis
Liquidity and Capital Resources, page 38
1. At the beginning of your discussion of liquidity and capital resources, you may want to consider explaining your overall capital structure w ith respect to the general availability of the assets of your insurance subsidiaries to satisfy the obligations of the parent company and certain of certain of its subsidiaries. In this regard, you may want to cons ider including a table that separately presents the assets and obligations of your insu rance and non-insurance operations.
2. In the second paragraph, you disclose th at your total debt represents 1.4 times stockholders equity. Its unc lear how this ratio supports the assertion that your financial condition is strong. Please explai n supplementally and consider revising your disclosure to explain how the aforem entioned ratio is an indication of your financial strength.
3. In the summary of this section on page 41, you cross reference footnote 9 for a more detailed discussion of your l ong-term debt and borrowing capacity. However, we believe your MD&A should include a discussion of these matters from management’s point of view. For example, by reference to exhibit 10.79 of your filing, we note that your credit agr eement with Merrill Lynch includes a covenant regarding the “Fleet Owner Cash Flow Ratio” and this covenant appears to limit the level of borrowings. As a ppropriate, please consider the need to provide an overall discussion of your borrowing levels and remaining borrowing capacity in MD&A.
Off Balance Sheet Arrangements, page 42
4. Please expand your disclosure to address, in further detail, the nature and business purpose for your off-balance sheet arrangements as required by Item 303(a)(4)(i)(A) of Regulation S-K. for ex ample, you state that you have used off- balance sheet arrangements in connection wi th the expansion of your self-storage business. However, it is unclear why th is business could not have been expanded within your consolidated operations.
5. It appears from your disclosures on page F-37 that you guarant ee certain related party debt instruments (e.g. support party ag reement with Private Mini.) As such, please revise your disclosures to include the total dollar amount related to these agreements and any other obligations th at would require disclosure under Item 303(a)(4)(ii) of Regulation S-K.
Jason A. Berg, Chief Accounting Officer AMERCO January 26, 2007 Page 3
Item 8- Financial Statements and Supplementary Data
Note 1- Basis of Presentation, page F-8
6. The operating results and financial po sition of your consolidated insurance operations are determined as of December 31 of each year. As such, please revise your disclosures to address the necessity for the use of different closing dates and the effect of intervening event that mate rially affect the fi nancial position or results of operations or lack thereof.
Note 3- Accounting Policies
Property, Plant and Equipment, F-12
7. We note that gains and losses on dispositions of property, plant and equipment are netted against depreciation expense when real ized. In this regard, please tell us what consideration has been given to the guidance in SAB Topic 5B.
8. Please tell us your basis fo r capitalizing and amortizing ma jor overhauls. Further, provide us with the length of the am ortization period related to the major overhauls and equipment as well as the authoritative accounti ng literature that supports your conclusions.
********
We urge all persons who are responsi ble for the accuracy an d adequacy of the disclosure in the filing to be certain that the filing includes all in formation required under the Securities Exchange Act of 1934 and th at they have provided all information investors require for an informed invest ment decision. Since the company and its management are in possession of all facts re lating to a company’s disclosure, they are responsible for the accuracy and adequacy of the disclosures they have made.
In connection with responding to our comments, please provide, in writing, a statement from the company acknowledging that:
the company is responsible for the adequacy and accuracy of the disclosure in the filing;
staff comments or changes to disclosure in response to staff comments do not foreclose the Commission from taking any action with respect to the filing; and
the company may not assert staff comments as a defense in any proceeding initiated by the Commission or any person under the federal securities laws of the United States.
Jason A. Berg, Chief Accounting Officer AMERCO January 26, 2007 Page 4
In addition, please be advise d that the Division of Enfo rcement has access to all information you provide to the staff of the Divi sion of Corporation Fi nance in our review of your filing or in response to our comments on your filing.
You may contact Juan Migone at (202) 551-3312 or the undersigned at (202) 551- 3211 if you have questions regarding comments on the financial statements and related matters.
Sincerely,
David R. Humphrey
Branch Chief
Show Raw Text
Mail Stop 3561
January 26, 2007
Via Fax & U.S. Mail
Jason A. Berg, Chief Accounting Officer
AMERCO
1325 Airmotive Way, Ste. 100
Reno, Nevada 89502
Re: AMERCO
Form 10-K for the year ended March 31, 2006
Filed June 13, 2006
File No. 001-10275
We have reviewed your filing and have the following comments. We think you
should revise your document in future filings in response to these comments. If you
disagree, we will consider your explanation as to why our comments are inapplicable or a
revision is unnecessary. Please be as detailed as necessary in your explanation. In some
of our comments, we may ask you to provide us with information so we may better
understand your disclosure. After reviewing th is information, we may raise additional
comments.
Please understand that the purpose of our re view process is to assist you in your
compliance with the applicable disclosure requirements and to enhance the overall
disclosure in your filing. We look forward to working with you in these respects. We
welcome any questions you may have about our comments or any other aspect of our review. Feel free to call us at the telephone numbers listed at the end of this letter.
Please respond to confirm that such comments will be complied with, or, if
certain of the comments are deemed inappropr iate, advise the staff of your reason. Your
response should be submitted in electronic form, under the label “corresp” with a copy to the staff. Please respond w ithin ten (10) business days.
Jason A. Berg, Chief Accounting Officer
AMERCO
January 26, 2007 Page 2
Form 10-K for the fiscal year ended March 31, 2006
Item 7- Management’s Discussion and Analysis
Liquidity and Capital Resources, page 38
1. At the beginning of your discussion of liquidity and capital resources, you may
want to consider explaining your overall capital structure w ith respect to the
general availability of the assets of your insurance subsidiaries to satisfy the
obligations of the parent company and certain of certain of its subsidiaries. In this
regard, you may want to cons ider including a table that separately presents the
assets and obligations of your insu rance and non-insurance operations.
2. In the second paragraph, you disclose th at your total debt represents 1.4 times
stockholders equity. Its unc lear how this ratio supports the assertion that your
financial condition is strong. Please explai n supplementally and consider revising
your disclosure to explain how the aforem entioned ratio is an indication of your
financial strength.
3. In the summary of this section on page 41, you cross reference footnote 9 for a
more detailed discussion of your l ong-term debt and borrowing capacity.
However, we believe your MD&A should include a discussion of these matters
from management’s point of view. For example, by reference to exhibit 10.79 of
your filing, we note that your credit agr eement with Merrill Lynch includes a
covenant regarding the “Fleet Owner Cash Flow Ratio” and this covenant appears
to limit the level of borrowings. As a ppropriate, please consider the need to
provide an overall discussion of your borrowing levels and remaining borrowing
capacity in MD&A.
Off Balance Sheet Arrangements, page 42
4. Please expand your disclosure to address, in further detail, the nature and business
purpose for your off-balance sheet arrangements as required by Item 303(a)(4)(i)(A) of Regulation S-K. for ex ample, you state that you have used off-
balance sheet arrangements in connection wi th the expansion of your self-storage
business. However, it is unclear why th is business could not have been expanded
within your consolidated operations.
5. It appears from your disclosures on page F-37 that you guarant ee certain related
party debt instruments (e.g. support party ag reement with Private Mini.) As such,
please revise your disclosures to include the total dollar amount related to these
agreements and any other obligations th at would require disclosure under Item
303(a)(4)(ii) of Regulation S-K.
Jason A. Berg, Chief Accounting Officer
AMERCO
January 26, 2007 Page 3
Item 8- Financial Statements and Supplementary Data
Note 1- Basis of Presentation, page F-8
6. The operating results and financial po sition of your consolidated insurance
operations are determined as of December 31 of each year. As such, please revise
your disclosures to address the necessity for the use of different closing dates and the effect of intervening event that mate rially affect the fi nancial position or
results of operations or lack thereof.
Note 3- Accounting Policies
Property, Plant and Equipment, F-12
7. We note that gains and losses on dispositions of property, plant and equipment are netted against depreciation expense when real ized. In this regard, please tell us
what consideration has been given to the guidance in SAB Topic 5B.
8. Please tell us your basis fo r capitalizing and amortizing ma jor overhauls. Further,
provide us with the length of the am ortization period related to the major
overhauls and equipment as well as the authoritative accounti ng literature that
supports your conclusions.
********
We urge all persons who are responsi ble for the accuracy an d adequacy of the
disclosure in the filing to be certain that the filing includes all in formation required under
the Securities Exchange Act of 1934 and th at they have provided all information
investors require for an informed invest ment decision. Since the company and its
management are in possession of all facts re lating to a company’s disclosure, they are
responsible for the accuracy and adequacy of the disclosures they have made.
In connection with responding to our comments, please provide, in writing, a statement from the company acknowledging that:
the company is responsible for the adequacy and accuracy of the disclosure in the
filing;
staff comments or changes to disclosure in response to staff comments do not
foreclose the Commission from taking any action with respect to the filing; and
the company may not assert staff comments as a defense in any proceeding initiated
by the Commission or any person under the federal securities laws of the United States.
Jason A. Berg, Chief Accounting Officer
AMERCO
January 26, 2007 Page 4
In addition, please be advise d that the Division of Enfo rcement has access to all
information you provide to the staff of the Divi sion of Corporation Fi nance in our review
of your filing or in response to our comments on your filing.
You may contact Juan Migone at (202) 551-3312 or the undersigned at (202) 551-
3211 if you have questions regarding comments on the financial statements and related
matters.
Sincerely,
David R. Humphrey
Branch Chief