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UNCONSOLIDATED AFFILIATED COMPANIES | 12 Months Ended
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Oct. 31, 2021
UNCONSOLIDATED AFFILIATED COMPANIES |
UNCONSOLIDATED AFFILIATED COMPANIES | 11. UNCONSOLIDATED AFFILIATED COMPANIES Unconsolidated affiliated companies are companies in which Deere & Company generally owns 20 percent to 50 percent of the outstanding voting shares. Deere & Company does not control these companies and accounts for its investments in them on the equity basis. The investments in these companies primarily consist of Deere-Hitachi Construction Machinery Corporation (50 percent ownership) and Deere-Hitachi Maquinas de Construcao do Brasil S.A. (50 percent ownership). During 2021, the company sold its investment in Bell Equipment Limited, resulting in no material gain or loss. The company also entered into a Dissolution Agreement with Hitachi to terminate the joint venture agreement. The termination is expected to occur in 2022 (see Note 4). The unconsolidated affiliated companies primarily manufacture or market equipment. Deere & Company’s share of the income or loss of these companies is reported in the consolidated income statement under “Equity in income (loss) of unconsolidated affiliates.” In 2020, the company recorded impairments on certain unconsolidated affiliates. The impairments were the result of an other-than-temporary decline in value (see Note 5). The investment in these companies is reported in the consolidated balance sheet under “Investments in unconsolidated affiliates.” Combined financial information of the unconsolidated affiliated companies in millions of dollars follows: ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Operations |  | 2021 |  | 2020 |  | 2019 |
Sales | ​ | $ | 2,095 | ​ | $ | 1,793 | ​ | $ | 2,483 | ​
Net income | ​ |  | 51 | ​ |  | 7 | ​ |  | 50 | ​
Deere & Company’s equity in net income (loss) | ​ |  | 21 | ​ | ​ | (48) | ​ |  | 21 | ​
​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
Financial Position |  | 2021 |  | 2020 |
Total assets | ​ | $ | 1,289 | ​ | $ | 1,541 | ​
Total external borrowings | ​ |  | 497 | ​ |  | 540 | ​
Total net assets | ​ |  | 366 | ​ |  | 598 | ​
Deere & Company’s share of the net assets | ​ |  | 175 | ​ |  | 193 | ​
​ Consolidated retained earnings at October 31, 2021 include undistributed earnings of the unconsolidated affiliates of $48 million. Dividends from unconsolidated affiliates were $21 million in 2021, none in 2020, and $30 million in 2019. In the ordinary course of business, the company purchases and sells components and finished goods to the unconsolidated affiliated companies. Transactions with unconsolidated affiliated companies reported in the statement of consolidated income in millions of dollars follow: ​
​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​ | ​
​ | ​ | 2021 |  | 2020 |  | 2019 | ​
Net sales | ​ | $ | 78 | ​ | $ | 81 | ​ | $ | 143 | ​
Purchases | ​ | ​ | 1,605 | ​ | ​ | 1,288 | ​ | ​ | 1,937 | ​
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- Definition The entire disclosure for equity method investments and joint ventures. Equity method investments are investments that give the investor the ability to exercise significant influence over the operating and financial policies of an investee. Joint ventures are entities owned and operated by a small group of businesses as a separate and specific business or project for the mutual benefit of the members of the group. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 323 -URI http://asc.fasb.org/topic&trid=2196965 + Details
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