SEC Comment Letter for ICAHN ENTERPRISES L.P. (IEP) (CIK 0000813762) (IEP) — May 21, 2009
ICAHN ENTERPRISES L.P. (IEP) (CIK 0000813762)
Date: May 21, 2009 · CIK: 0000813762 · Accession: 0000000000-09-027211
AI Filing Summary & Sentiment
Reasoning
Letter
Mail Stop 3010 April 28, 2009 Via U.S. Mail and Facsimile 917.591.3412 Mr. Dominick Ragone Chief Financial Officer of Icahn Enterprise s G.P. Inc., the General Partner of Icahn Enterprises L.P. Icahn Enterprises L.P. 767 Fifth Street, Suite 4700 New York, NY 10153
Re: Icahn Enterprises L.P. Form 10-K for fiscal ye ar ended December 31, 2008 Filed March 4, 2009 File No. 1-9516
Dear Mr. Ragone:
We have reviewed your filing and have the following comments. If you disagree with our comments, we will consider your e xplanation as to why our comments are not applicable. Please be as deta iled as necessary in your expl anation. In our comments, we may ask you to provide us with information so we may better understand your disclosure. After reviewing this 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 on any other aspect of our review. Feel free to call us at the telephone numbers listed at the end of this letter.
Dominick Ragone Icahn Enterprises L.P. April 28, 2009 Page 2 Form 10-K for the fiscal year ended December 31, 2008
Item 6. Selected Financial Data
1. It appears that EBITDA is used as a performance measure and you have excluded the components of EBITDA without dem onstrating the usefulness of excluding these recurring items. Please explain to us how you considered the need to provide the disclosures in Item 10(e) of Regulations S-K and questions 8 and 15 of the SEC’s Frequently Asked Questions Regarding the Use of Non-GAAP Financial Measures for this measure. Item 7. Management’s Discussion and Analys is of Financial Condition and Results of Operations Results of Operations
Consolidated Financial Resu lts of Continuing Operations
Investment Management
Revenues, page 56
2. We note that in the event that suffici ent net profits are not generated by an Investment Fund that the special profits interest allocation will be carried forward for any shortfall to the targeted amount. Regarding the waiving of special profits interest allocations effective January 1, 2008, please confirm to us that the target special profits interest allocations will not be due in future periods related to all investments held during fiscal ye ar 2008, not only the $510 million net investment made by you and affiliates of Carl Icahn during the current year ended December 31, 2008. It appears that base d on your disclosure that the $70 million representing the entire fiscal 2008 Target Special Profits Amount will be carried forward into future periods and will be accrued to the extent that there are sufficient net profits in the Investment Funds during the investment period to cover such amounts.
Automotive, page 62
3. Please tell us the basis for consolida ting the financial po sition, results of operations and cash flows of Federal-M ogul Corporation as of March 1, 2008, which approximates the date of acqui sition of Federal-Mogul by a separate limited partnership wholly-owned by Carl Icahn, and not as of July 3, 2008, the date of acquisition by the partnership. Please cite accounting literature relied upon.
Dominick Ragone Icahn Enterprises L.P. April 28, 2009 Page 3 Other Liquidity and Capital Resource Items
Distributions
Preferred Units, page 80
4. Please tell us and disclose in future filings the company’s ability to redeem the preferred units by March 31, 2010. We note th at you have the option to settle the redemption in cash or issuance of depository units. Please tell us and disclose the sources of cash that would be used to redeem the preferred units if you were to redeem the preferred units for cash. If such preferred units are redeemed for depository units, please discuss whether the amount of authorized depository units available for issuance is sufficient to re deem the preferred units. If not, please note whether you will authorize additiona l depository units to redeem the preferred units.
Item 8. Financial Statements and Supplementary Data
Consolidated Balance Sheets, page 94 5. We note that you separately present the a ssets and liabilities of your continuing operating segments on the face of your consol idated balance sheets. Explain to us how your presentation complies with Rule 5-02 of Regulation S-X. 6. We note that you have a balance in accumu lated other comprehensive loss as of December 31, 2008. Please tell us how the di sclosure of Partners’ equity within your consolidated balance sheets comp lies with paragraph 26 of SFAS 130. Further, please tell us wh at accounting literature you re lied upon to disclose only the balance as of the end of the most recently completed fiscal year. Consolidated Statements of Operations, page 95
7. We note that you disclose only the reve nue totals for each of your continuing operating segments on the face of your consolidated statements of operations. Explain to us how your presentation comp lies with Rule 5-03 of Regulation S-X. Consolidated Statements of Cash Flows, page 97
8. We note that you separately present oper ating, investing, and financing cash flows of your continuing operating segments on the face of your consolidated statements of cash flows. Please c ite accounting literatu re relied upon in determining how such presentation is in accordance with US-GAAP.
Dominick Ragone Icahn Enterprises L.P. April 28, 2009 Page 4 9. Please tell us the composition of Net cas h provided by investing activities from discontinued operations with in your Consolidated Statement of Cash Flows of $1,069 million. Please tell us how such amount correlates to the Gain on dispositions, net of income taxes recorded within your Consolidated Statements of Operations totaling $478 million. Also, we note your disclosure within note 5 which notes the gain “includes $472 milli on, net of income taxes of $260 million, recorded on the sale of ACEP on February 20, 2008.” Notes to Consolidated Financial Statements
2. Summary of Significant Accounting Policies Revenue and Expense Recognition
Home Fashion
10. Regarding sales incentives, please tell us and disclose in future filings the composition of such customer incentiv es (i.e., volume-based incentive arrangements; consideration in the form of discounts or rebates; et cetera) and quantify the amount recorded in period presented. Further, please note the accounting literature relied upon in accounting for su ch incentives, including your treatment of incentives as a reduction to sales. 7. Investments and Related Matters
c. Automotive, page 133
11. We note that pursuant the agreement relate d to your non-controlling interest in a joint venture located in Turkey that your partner holds an option to put its shares in the joint venture to a subsidiary of Federal-Mogul at the higher of the current fair value and a guaranteed amount. We further note that no amount is recorded for such contingent guarantee. Please te ll us the scope exemption relied upon to conclude that such guarantee is not subject to the initial recognition and measurement provisions of FIN 45.
* * * *
As appropriate, please respond to these co mments within 10 business days or tell us when you will provide us with a response. Please submit a response letter on EDGAR that keys your response to our comments and provides any requested information. Detailed cover letters greatly facilitate our review. Please understa nd that we may have additional comments after reviewin g your response to our comments.
Dominick Ragone Icahn Enterprises L.P. April 28, 2009 Page 5 We urge all persons who are responsible for the accuracy and adequacy of the disclosure in the filings reviewed by the sta ff to be certain that they have provided all information investors require for an info rmed 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 filings;
• staff comments or changes to disclosure in response to staff comments do not foreclose the Commission from taking any action with respect to the filings; and
• the company may not assert staff comme nts as a defense in any proceeding initiated by the Commission or any person under the federal secu rities laws of the United States.
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 filings or in response to our comments on your filings. You may contact Mark Rakip, Sta ff Accountant, at 202.551.3573 or the undersigned at 202.551.3629 if you have questions.
S i n c e r e l y , Kevin Woody Accounting Branch Chief
Show Raw Text
Mail Stop 3010
April 28, 2009
Via U.S. Mail and Facsimile 917.591.3412
Mr. Dominick Ragone Chief Financial Officer of Icahn Enterprise s G.P. Inc., the General Partner of Icahn
Enterprises L.P.
Icahn Enterprises L.P. 767 Fifth Street, Suite 4700 New York, NY 10153
Re: Icahn Enterprises L.P.
Form 10-K for fiscal ye ar ended December 31, 2008
Filed March 4, 2009
File No. 1-9516
Dear Mr. Ragone:
We have reviewed your filing and have the following comments. If you disagree
with our comments, we will consider your e xplanation as to why our comments are not
applicable. Please be as deta iled as necessary in your expl anation. In our comments, we
may ask you to provide us with information so we may better understand your disclosure.
After reviewing this 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 on any other aspect of our
review. Feel free to call us at the telephone numbers listed at the end of this letter.
Dominick Ragone
Icahn Enterprises L.P. April 28, 2009 Page 2 Form 10-K for the fiscal year ended December 31, 2008
Item 6. Selected Financial Data
1. It appears that EBITDA is used as a performance measure and you have excluded
the components of EBITDA without dem onstrating the usefulness of excluding
these recurring items. Please explain to us how you considered the need to provide the disclosures in Item 10(e) of Regulations S-K and questions 8 and 15
of the SEC’s Frequently Asked Questions Regarding the Use of Non-GAAP
Financial Measures for this measure.
Item 7. Management’s Discussion and Analys is of Financial Condition and Results of
Operations
Results of Operations
Consolidated Financial Resu lts of Continuing Operations
Investment Management
Revenues, page 56
2. We note that in the event that suffici ent net profits are not generated by an
Investment Fund that the special profits interest allocation will be carried forward for any shortfall to the targeted amount. Regarding the waiving of special profits
interest allocations effective January 1, 2008, please confirm to us that the target
special profits interest allocations will not be due in future periods related to all
investments held during fiscal ye ar 2008, not only the $510 million net
investment made by you and affiliates of Carl Icahn during the current year ended
December 31, 2008. It appears that base d on your disclosure that the $70 million
representing the entire fiscal 2008 Target Special Profits Amount will be carried
forward into future periods and will be accrued to the extent that there are
sufficient net profits in the Investment Funds during the investment period to
cover such amounts.
Automotive, page 62
3. Please tell us the basis for consolida ting the financial po sition, results of
operations and cash flows of Federal-M ogul Corporation as of March 1, 2008,
which approximates the date of acqui sition of Federal-Mogul by a separate
limited partnership wholly-owned by Carl Icahn, and not as of July 3, 2008, the
date of acquisition by the partnership. Please cite accounting literature relied
upon.
Dominick Ragone
Icahn Enterprises L.P. April 28, 2009 Page 3 Other Liquidity and Capital Resource Items
Distributions
Preferred Units, page 80
4. Please tell us and disclose in future filings the company’s ability to redeem the
preferred units by March 31, 2010. We note th at you have the option to settle the
redemption in cash or issuance of depository units. Please tell us and disclose the
sources of cash that would be used to redeem the preferred units if you were to
redeem the preferred units for cash. If such preferred units are redeemed for
depository units, please discuss whether the amount of authorized depository units
available for issuance is sufficient to re deem the preferred units. If not, please
note whether you will authorize additiona l depository units to redeem the
preferred units.
Item 8. Financial Statements and Supplementary Data
Consolidated Balance Sheets, page 94
5. We note that you separately present the a ssets and liabilities of your continuing
operating segments on the face of your consol idated balance sheets. Explain to us
how your presentation complies with Rule 5-02 of Regulation S-X.
6. We note that you have a balance in accumu lated other comprehensive loss as of
December 31, 2008. Please tell us how the di sclosure of Partners’ equity within
your consolidated balance sheets comp lies with paragraph 26 of SFAS 130.
Further, please tell us wh at accounting literature you re lied upon to disclose only
the balance as of the end of the most recently completed fiscal year.
Consolidated Statements of Operations, page 95
7. We note that you disclose only the reve nue totals for each of your continuing
operating segments on the face of your consolidated statements of operations. Explain to us how your presentation comp lies with Rule 5-03 of Regulation S-X.
Consolidated Statements of Cash Flows, page 97
8. We note that you separately present oper ating, investing, and financing cash flows
of your continuing operating segments on the face of your consolidated statements of cash flows. Please c ite accounting literatu re relied upon in
determining how such presentation is in accordance with US-GAAP.
Dominick Ragone
Icahn Enterprises L.P. April 28, 2009 Page 4 9. Please tell us the composition of Net cas h provided by investing activities from
discontinued operations with in your Consolidated Statement of Cash Flows of
$1,069 million. Please tell us how such amount correlates to the Gain on
dispositions, net of income taxes recorded within your Consolidated Statements of
Operations totaling $478 million. Also, we note your disclosure within note 5
which notes the gain “includes $472 milli on, net of income taxes of $260 million,
recorded on the sale of ACEP on February 20, 2008.”
Notes to Consolidated Financial Statements
2. Summary of Significant Accounting Policies
Revenue and Expense Recognition
Home Fashion
10. Regarding sales incentives, please tell us and disclose in future filings the
composition of such customer incentiv es (i.e., volume-based incentive
arrangements; consideration in the form of discounts or rebates; et cetera) and
quantify the amount recorded in period presented. Further, please note the
accounting literature relied upon in accounting for su ch incentives, including your
treatment of incentives as a reduction to sales.
7. Investments and Related Matters
c. Automotive, page 133
11. We note that pursuant the agreement relate d to your non-controlling interest in a
joint venture located in Turkey that your partner holds an option to put its shares
in the joint venture to a subsidiary of Federal-Mogul at the higher of the current
fair value and a guaranteed amount. We further note that no amount is recorded
for such contingent guarantee. Please te ll us the scope exemption relied upon to
conclude that such guarantee is not subject to the initial recognition and
measurement provisions of FIN 45.
* * * *
As appropriate, please respond to these co mments within 10 business days or tell
us when you will provide us with a response. Please submit a response letter on EDGAR
that keys your response to our comments and provides any requested information.
Detailed cover letters greatly facilitate our review. Please understa nd that we may have
additional comments after reviewin g your response to our comments.
Dominick Ragone
Icahn Enterprises L.P. April 28, 2009 Page 5 We urge all persons who are responsible for the accuracy and adequacy of the
disclosure in the filings reviewed by the sta ff to be certain that they have provided all
information investors require for an info rmed 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
filings;
• staff comments or changes to disclosure in response to staff comments do not
foreclose the Commission from taking any action with respect to the filings; and
• the company may not assert staff comme nts as a defense in any proceeding
initiated by the Commission or any person under the federal secu rities laws of the
United States.
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 filings or in response to our comments on your filings.
You may contact Mark Rakip, Sta ff Accountant, at 202.551.3573 or the
undersigned at 202.551.3629 if you have questions.
S i n c e r e l y ,
Kevin Woody Accounting Branch Chief